As Filed with the Securities and Exchange Commission on August 9, 2017

 

Registration No. 333-         

 

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

 

 

FORM S-8
Registration Statement Under The Securities Act of 1933

 

 

RADNET, INC.

(Exact name of registrant as specified in its charter)

 

Delaware

(State or other jurisdiction of
incorporation or organization)

13-3326724

(I.R.S. Employer
Identification No.)

   

1510 Cotner Avenue
Los Angeles, California

(Address of Principal Executive Offices)

90025

(Zip Code)

 

 

2006 EQUITY INCENTIVE PLAN

(Full title of the plan)

 

Howard G. Berger, M.D.
President and Chief Executive Officer
RadNet, Inc.
1510 Cotner Avenue
Los Angeles, California, 90025

(Name and Address of Agent For Service)

 

(310) 478-7808

(Telephone number, including area code, of agent for service)

 

Copy to:

 

Linda Giunta Michaelson, Esq.
Sheppard, Mullin, Richter & Hampton llp
1901 Avenue of the Stars, Suite 1600
Los Angeles, California 90067

 

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company” and “emerging growth company” in Rule 12b-2 of the Exchange Act. (Check one):

 

Large Accelerated filer o

Emerging growth company o

  Accelerated filer ý   Non-accelerated filer o
(Do not check if a smaller reporting company) 		  Smaller reporting company o

 

 

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 7(a)(2)(B) of the Securities Act of 1933, as amended. o

 

 

 

 

     

 

 

CALCULATION OF REGISTRATION FEE

 

Title of  Securities to be Registered   Amount to be
Registered (1) 		  Proposed
Maximum
Offering
Price
Per Share (3) 		  Proposed
Maximum
Aggregate
Offering
Price 		  Amount of
Registration Fee
Common Stock, par value $0.0001 per share, issuable under 2006 Equity Incentive Plan (2)   2,000,000 shares   $ 7.58   $ 15,160,000 (3)    $ 1,757.04
                       
(1) In accordance with Rule 416 under the Securities Act of 1933, as amended, this registration statement shall cover any additional shares of registrant’s common stock that may from time to time be offered or issued under the anti-dilution adjustment provisions of the 2006 Equity Incentive Plan, as amended and restated, resulting from stock splits, stock dividends or similar transactions.

 

(2) Represents 2,000,000 additional shares of the registrant’s common stock that became available for issuance on June 8, 2017 under the 2006 Equity Incentive Plan, as amended and restated, which shares are in addition to the 12,000,000 shares of common stock registered on the registrant’s registration statements on Form S-8 filed with the Securities and Exchange Commission on (i) June 11, 2007, as amended on September 5, 2008, (ii) August 27, 2008, as amended on September 5, 2008, (iii) June 19, 2009, (iv) August 15, 2011 and (v) August 12, 2015.

 

(3) Estimated solely for the purpose of calculating the registration fee in accordance with Rules 457(c) and (h) promulgated under the Securities Act of 1933, as amended, based upon the average of the high and low prices of the registrant’s common stock as reported on the Nasdaq Stock Market on August 3, 2017.

 

 

 

 

 

 

 

 

 

     

 

 

PART I

 

INFORMATION REQUIRED IN THE SECTION 10(a) PROSPECTUS

 

Information required by Part I to be contained in the Section 10(a) prospectus is omitted from this Registration Statement in accordance with Rule 428 under the Securities Act of 1933, as amended, and the Note to Part I of Form S-8.

 

PART II

 

INFORMATION REQUIRED IN THE REGISTRATION STATEMENT

 

Item 3. Incorporation of Documents by Reference

 

The following documents filed by the registrant with the SEC are hereby incorporated by reference into this registration statement:

 

(a) Annual Report on Form 10-K for the fiscal year ended December 31, 2016, filed on March 16, 2017;

 

(b) Amended Annual Report on Form 10-K/A for the fiscal year ended December 31, 2016, filed on March 31, 2017;

 

(c) Quarterly Report on Form 10-Q for the quarter ended March 31, 2017, filed on May 10, 2017;

 

(d) Current Report on Form 8-K filed on June 13, 2017; and

 

(e) The description of the registrant’s common stock which is contained in the registration statement on Form 8-A filed with the SEC on February 13, 2007, as amended on February 14, 2007, and any amendment or report filed for the purpose of updating such description; including the description of the common stock of the registrant as a Delaware corporation under the heading “Significant Changes Resulting From The Reincorporation” in the registrant’s Proxy Statement on Schedule 14A, filed with the Securities and Exchange Commission on April 17, 2008 and any amendment or report filed for the purpose of updating such description.

 

In addition, all documents subsequently filed by us pursuant to Sections 13(a), 13(c), 14 and 15(d) of the Securities Exchange Act of 1934, prior to the filing of a post-effective amendment which indicates that all securities offered have been sold or which deregisters all securities then remaining unsold, shall be deemed to be incorporated by reference into this registration statement from the date of filing of such documents.

 

Any statement contained in a document incorporated or deemed to be incorporated by reference herein shall be deemed to be modified or superseded for the purposes of this registration statement to the extent that a statement contained herein or in any other subsequently filed document which also is or is deemed to be incorporated by reference herein modifies or supersedes such statement. Any statement so modified or superseded shall not be deemed, except as so modified or superseded, to constitute a part of this registration statement.

 

Item 4. Description of Securities.

 

Not applicable.

 

Item 5. Interests of Named Experts and Counsel.

 

The validity of the shares of common stock offered hereby has been passed upon for the registrant by Jeffrey L. Linden, Esq., Executive Vice President and General Counsel of the registrant. Mr. Linden is compensated by the registrant as an officer of the registrant and is a participant in the 2006 Plan. As of August 9, 2017, Mr. Linden held 980,401 shares of common stock, 41,667 restricted stock units which can be settled on a one-for-one basis with shares of common stock, and options to acquire 84,912 shares of Common Stock.

 

 

 

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Item 6. Indemnification of Directors and Officers.

 

Delaware Law, Certificate of Incorporation, and Bylaws

 

The following provisions of Delaware law and the registrant’s certificate of incorporation and bylaws govern the indemnification of the registrant’s directors and officers.

 

Section 145 of the Delaware General Corporation Law (the “DGCL”) permits a corporation to indemnify any director, officer, employee or agent of the corporation, or other person who is or was serving at the request of the corporation as a director, officer, employee or agent of another corporation, partnership, joint venture, trust or other enterprise, any such person we refer to as an indemnitee, against expenses (including attorney’s fees), judgments, fines and amounts paid in settlement actually and reasonably incurred in connection with any action, suit or proceeding brought by reason of the fact that the indemnitee is or was serving the corporation or another entity at the direction of the corporation, provided that the indemnitee acted in good faith and in a manner that he or she reasonably believed to be in, or not opposed to, the best interests of the corporation, and, with respect to any criminal action or proceeding, if he or she had no reason to believe his or her conduct was unlawful. In a derivative action (i.e., one brought by or on behalf of the corporation), indemnification may be provided only for expenses actually and reasonably incurred by the indemnitee in connection with the defense or settlement of such an action or suit if the indemnitee acted in good faith and in a manner that he or she reasonably believed to be in, or not opposed to, the best interests of the corporation, except that no indemnification shall be provided if the indemnitee is adjudged to be liable to the corporation, unless and only to the extent that the court in which the action or suit was brought determines that the indemnitee is fairly and reasonably entitled to indemnity for his or her expenses despite the adjudication of liability.

 

Section 145(g) of the DGCL also provides that a corporation may maintain insurance against liabilities even if the corporation would lack the power under the DGCL to indemnify against those liabilities.

 

Article Ninth of the registrant’s certificate of incorporation provides that a director is not liable to the registrant or its stockholders for monetary damages for breach of fiduciary duty as a director to the fullest extent permitted by the DGCL. It further obligates the registrant, with respect to its officers and directors, and permits the registrant, with respect to its employees and agents, to indemnify, in the manner and to the fullest extent permitted by the DGCL, any person (or the estate of any person) who is or was a party to, or is threatened to be made a party to, any threatened, pending or completed action, suit or proceeding, whether or not by or in the right of the registrant, and whether civil, criminal, administrative, investigative or otherwise, by reason of the fact that the person is or was a director or officer, or employee or agent, as the case may be, of the registrant, or is or was serving at the request of the registrant as a director or officer, or employee or agent, as the case may be, of another corporation or entity. The registrant may advance the expenses incurred by any such director, officer, employee or agent in defending any such action, suit or proceeding prior to its final disposition upon receipt of an undertaking by the recipient to repay the amounts advanced if it is ultimately determined that he or she is not entitled to be indemnified as authorized by the DGCL and the registrant’s certificate of incorporation. To the fullest extent permitted by the DGCL, the indemnification provided in the certificate of incorporation includes expenses (including attorneys’ fees), judgments, fines and amounts paid in settlement and, in the manner provided by the DGCL, the registrant may pay any of these expenses in advance of the final disposition of such action, suit or proceeding.

 

Except as described in this paragraph, Article VII of the registrant’s bylaws contains provisions substantially similar to Article Ninth of the registrant’s certificate of incorporation. In addition, the registrant’s bylaws obligate the registrant to indemnify each of its officers, directors, employees and agents in any action, suit or proceeding referred to above to the extent that person has been successful on the merits in defense thereof, or in defense of any claim, issue or matter therein, against expenses (including attorneys’ fees) actually and reasonably incurred by that person in connection therewith. The registrant’s bylaws obligate the registrant to advance expenses to its officers and directors, and require an undertaking to repay expenses under the specified conditions if required by applicable law.

 

General

 

The registrant also maintains insurance for its officers and directors against certain liabilities, including liabilities under the Securities Act of 1933. The effect of this insurance is to indemnify any of the registrant’s officers or directors against expenses, including attorneys’ fees, judgments, fines and amounts paid in settlement, incurred by an officer or director upon a determination that such person acted in good faith. The registrant pays the premiums for this insurance.

 

The registrant has also entered into separate indemnification agreements with its officers and directors, which indemnify the officer or director against all liabilities relating to his or her position as an officer or director of the registrant, or as an employee, agent, officer or director of any other entity if the officer or director is serving in that capacity at the registrant’s request, to the fullest extent permitted under applicable law.

 

 

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Insofar as indemnification for liabilities arising under the Securities Act of 1933 may be permitted to the registrant’s directors, officers or controlling persons pursuant to the foregoing provisions, the registrant has been informed that, in the opinion of the SEC, such indemnification is against public policy as expressed in the Securities Act of 1933 and is, therefore, unenforceable. In addition, indemnification for violations of state securities laws may be limited by applicable laws.

 

Item 7. Exemption from Registration Claimed.

 

Not applicable.

 

Item 8. Exhibits.

 

See Index to Exhibits.

 

Item 9. Undertakings.

 

(a) The undersigned registrant hereby undertakes:

 

(1) To file, during any period in which offers or sales are being made, a post-effective amendment to this registration statement:

 

(i) To include any prospectus required by section 10(a)(3) of the Securities Act of 1933;

 

(ii) To reflect in the prospectus any facts or events arising after the effective date of this registration statement (or the most recent post-effective amendment thereof) which, individually or in the aggregate, represent a fundamental change in the information set forth in this registration statement. Notwithstanding the foregoing, any increase or decrease in volume of securities offered (if the total dollar value of securities offered would not exceed that which was registered) and any deviation from the low or high end of the estimated maximum offering range may be reflected in the form of prospectus filed with the SEC pursuant to Rule 424(b) if, in the aggregate, the changes in volume and price represent no more than 20% change in the maximum aggregate offering price set forth in the “Calculation of Registration Fee” table in the effective registration statement;

 

(iii) To include any material information with respect to the plan of distribution not previously disclosed in the registration statement or any material change to such information in this registration statement;

 

Provided, however , that paragraphs (a)(1)(i) and (a)(1)(ii) do not apply if the information required to be included in a post-effective amendment by those paragraphs is contained in reports filed with or furnished to the Commission by the registrant pursuant to Section 13 or Section 15(d) of the Securities Exchange Act of 1934 that are incorporated by reference in this registration statement.

 

(2) That, for the purpose of determining any liability under the Securities Act of 1933, each such post-effective amendment shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof.

 

(3) To remove from registration by means of a post-effective amendment any of the securities being registered which remain unsold at the termination of the offering.

 

(b) The undersigned registrant hereby undertakes that, for purposes of determining any liability under the Securities Act of 1933, each filing of the registrant’s annual report pursuant to Section 13(a) or Section 15(d) of the Securities Exchange Act of 1934 (and, where applicable, each filing of an employee benefit plan’s annual report pursuant to Section 15(d) of the Securities Exchange Act of 1934) that is incorporated by reference in the registration statement shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof.

 

(c) Insofar as indemnification for liabilities arising under the Securities Act of 1933 may be permitted to directors, officers and controlling persons of the registrant pursuant to the foregoing provisions, or otherwise, the registrant has been advised that in the opinion of the Securities and Exchange Commission such indemnification is against public policy as expressed in the Securities Act of 1933 and is, therefore, unenforceable. In the event that a claim for indemnification against such liabilities (other than the payment by the registrant of expenses incurred or paid by a director, officer or controlling person of the registrant in the successful defense of any action, suit or proceeding) is asserted by such director, officer or controlling person in connection with the securities being registered, the registrant will, unless in the opinion of its counsel the matter has been settled by controlling precedent, submit to a court of appropriate jurisdiction the question whether such indemnification by it is against public policy as expressed in the Securities Act of 1933 and will be governed by the final adjudication of such issue.

 

 

 

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SIGNATURES

 

Pursuant to the requirements of the Securities Act of 1933, as amended, the registrant certifies that it has reasonable grounds to believe that it meets all of the requirements for filing on Form S-8 and has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in the City of Los Angeles, State of California, on August 9, 2017.

 

  RADNET, INC.
   
  By:   /s/ Howard G. Berger, M.D.
  Howard G. Berger, M.D.
President and Chief Executive Officer

 

POWER OF ATTORNEY

 

KNOW ALL PERSONS BY THESE PRESENTS, that each person whose signature appears below hereby constitutes and appoints Howard G. Berger, M.D. and Mark D. Stolper, jointly and severally, the undersigned’s true and lawful attorney-in-fact and agent, each with full power of substitution and resubstitution, for the undersigned and in his or her name, place and stead, in any and all capacities (including the undersigned’s capacity as a director and/or officer of RadNet, Inc.), to sign any or all amendments (including post-effective amendments) to this registration statement and any other registration statement for the same offering, and to file the same, with all exhibits thereto, and other documents in connection therewith, with the Securities and Exchange Commission, granting unto said attorney-in-fact and agent full power and authority to do and perform each and every act and thing requisite and necessary to be done in and about the premises, as fully for all intents and purposes as he or she might or could do in person, hereby ratifying and confirming all that each of said attorneys-in-fact and agent, or his or her substitute, acting alone, may lawfully do or cause to be done by virtue hereof.

 

Pursuant to the requirements of the Securities Act of 1933, as amended, this registration statement has been signed by the following persons in the capacities and on the date indicated.

 

Name   Title   Date
         

/s/Howard G. Berger, M.D.

Howard G. Berger, M.D.

  Director, Chief Executive Officer and President (Principal Executive Officer)   August 9, 2017

         
         

/s/ Mark D. Stolper

Mark D. Stolper

  Chief Financial Officer (Principal Financial Officer and Principal Accounting Officer)   August 9, 2017

         
         

/s/ Marvin S. Cadwell

Marvin S. Cadwell

  Director

  August 9, 2017

         
         

/s/ John V. Crues, III, M.D.

John V. Crues, III, M.D.

  Director

  August 9, 2017

         
         

/s/Norman R. Hames

Norman R. Hames

  Director

  August 9, 2017

         
         

/s/ David L. Swartz

David L. Swartz

  Director

  August 9, 2017

         
         

/s/Lawrence L. Levitt

Lawrence L. Levitt

  Director

  August 9, 2017

         
         

/s/ Michael L. Sherman, M.D

Michael L. Sherman, M.D.

  Director

  August 9, 2017

         
         

 

 

 

 

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INDEX TO EXHIBITS

 

The following documents are filed as exhibits to this registration statement:

 

Exhibit
Number 		Description
4.1 Certificate of Incorporation of RadNet, Inc., a Delaware corporation (incorporated by reference to exhibit filed with Form 8-K on September 4, 2008)
4.2 Certificate of Amendment to Certificate of Incorporation of RadNet, Inc., a Delaware corporation, dated September 2, 2008 (incorporated by reference to exhibit filed with Form 8-K on September 4, 2008)
4.3 Bylaws of RadNet, Inc., a Delaware corporation (incorporated by reference to exhibit filed with Form 8-K on September 4, 2008)
4.4 Specimen Common Stock Certificate (incorporated by reference to exhibit filed with Form 10-K for the fiscal year ended October 31, 2006, on February 7, 2007)
5.1 Opinion of General Counsel *
23.1 Consent of Independent Registered Public Accounting Firm *
23.2 Consent of General Counsel (included in Exhibit 5.1)
24.1 Power of Attorney (see signature page)
99.1 2006 Equity Incentive Plan, amended and restated as of March 9, 2017 (incorporated by reference to exhibit filed with Form 8-K on June 13, 2017)
99.2 Form of Incentive Option Agreement for the 2006 Equity Incentive Plan *
99.3 Form of Nonstatutory Option Agreement for the 2006 Equity Incentive Plan *
99.4 Form of Restricted Stock Award for Officers under the 2006 Equity Incentive Plan *
99.5 Form of Restricted Stock Award for Non-Employee Directors under the 2006 Equity Incentive Plan *
99.6 Form of Restricted Stock Unit Agreement (deferred settlement) for Officers under the 2006 Equity Incentive Plan *
99.7 Form of Restricted Stock Unit Agreement (deferred settlement) for Non-Employee Directors under the 2006 Equity Incentive Plan *
99.8 Nonqualified Deferred Compensation Plan, effective as of May 5, 2016 (incorporated by reference to exhibit filed with Form 8-K on May 9, 2016)

_____________________

* Filed herewith

 

 

 

 

     

 

EXHIBIT 5.1

 

 

 

August 9, 2017

 

 

RadNet, Inc.

1510 Cotner Avenue

Los Angeles, CA 90025

 

 

 

 

 

 

  Re: Registration Statement on Form S-8

 

Ladies and Gentlemen:

 

This opinion is being furnished in connection with the filing by RadNet, Inc., a Delaware corporation (the “Company”), of a registration statement on Form S-8 (the “Registration Statement”) under the Securities Act of 1933, as amended, covering 2,000,000 shares (the “Shares”) of the Company’s common stock, par value $0.0001 per share (the “Common Stock”), which may be issued pursuant to the Company’s 2006 Equity Incentive Plan, amended and restated as of March 9, 2017 (the “2006 Plan”).

 

This opinion is being furnished in accordance with the requirements of Item 8 of Form S-8 and Item 601(b)(5)(i) of Regulation S-K.

 

In connection with this opinion, I have reviewed the Registration Statement, the Company’s charter documents, the proceedings taken by the Company with respect to the authorization and adoption of the 2006 Plan, certificates of government officials, and such other documents, records, certificates, memoranda and other instruments as I deem necessary as a basis for this opinion. With respect to the foregoing documents, I have assumed the genuineness of all signatures, the authenticity of all documents submitted to me as originals and the conformity to originals of all documents submitted to me as certified or reproduced copies. I have also assumed that either (i) the stock certificates to be issued to represent the Shares (collectively, the “Stock Certificates”) will conform to the specimen common stock certificate submitted to me, and such Stock Certificates will be duly executed by the Company and countersigned by the transfer agent therefor in accordance with Section 158 of the Delaware General Corporation Law (“Section 158”), or (ii) the Shares will be uncertificated in accordance with Section 158 and the Company’s Bylaws, and the transfer agent therefor will register the purchaser thereof as the registered owner of any uncertificated Shares on its stock transfer books and records. I have further assumed that (i) shares currently reserved will remain available for the issuance of the Shares, and (ii) neither the Company’s charter documents nor any of the proceedings relating to the 2006 Plan, nor any of the option agreements relating to the Shares, will be rescinded, amended or otherwise modified prior to the issuance of the Shares. I have obtained from the officers of the Company certificates as to certain factual matters and, insofar as this opinion is based on matters of fact, I have relied on such certificates without independent investigation.

 

Based on the foregoing review, and in reliance thereon, I am of the opinion that if, as and when the Shares are issued and sold by the Company in accordance with the terms of the stock option or other agreements provided for under the 2006 Plan, and payment in full of the consideration therefor is received by the Company, the Shares will be validly issued, fully paid and nonassessable.

 

I consent to the filing of this opinion letter as Exhibit 5.1 to the Registration Statement.

 

I express no opinion as to matters governed by any laws other than the Delaware General Corporation Law, the applicable provisions of the Delaware Constitution and reported decisions of the Delaware courts interpreting these respective laws.

 

My opinion is expressly limited to the matters set forth above, and I render no opinion, whether by implication or otherwise, as to any other matters relating to the Company, the Shares, the 2006 Plan, the option or other agreements related to the Shares, or the Registration Statement.

 

  Respectfully submitted,
   
  /s/ Jeffrey L. Linden
  Jeffrey L. Linden

EXHIBIT 23.1

 

 

 

CONSENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

 

 

We consent to the incorporation by reference in the Registration Statement (Form S-8) pertaining to the 2006 Equity Incentive Plan of RadNet, Inc. of our reports dated March 16, 2017, with respect to the consolidated financial statements and schedule of RadNet, Inc. and subsidiaries, and the effectiveness of internal control over financial reporting of RadNet, Inc. and subsidiaries, included in its Annual Report (Form 10-K) for the year ended December 31, 2016, and to the incorporation by reference therein of our report dated March 31, 2015 with respect to the combined statements of income, partners’ capital, and cash flows of certain RadNet, Inc. affiliates including Franklin Imaging Joint Venture, Carroll County Radiology, LLC, MRI at St. Joseph Medical Center, LLC, and Greater Baltimore Diagnostic Imaging Partnership, included in Amendment No. 1 to the Form-10K (Form 10-K/A) for the year ended December 31, 2016, filed with the Securities and Exchange Commission.

 

 

 

/s/ Ernst & Young LLP           

 

Los Angeles, California
August 9, 2017

EXHIBIT 99.2

 

 

RADNET, INC.

2006 EQUITY INCENTIVE PLAN

 

INCENTIVE STOCK OPTION AGREEMENT

 

Radnet, Inc., a Delaware corporation, (the “Company”), hereby grants an Option to purchase Shares to the Optionee named below. The terms and conditions of the Option are set forth in this cover sheet and the attached Incentive Stock Option Agreement (together, this “Agreement”) and in the Radnet Inc. 2006 Equity Incentive Plan as it may be amended from time to time.

 

Date of Option Grant: __________________, [YEAR]

 

Name of Optionee (“you”, “your”, or “Optionee”): ______________________________________________

 

Number of Shares Covered by Option: ______________

 

Exercise Price per Share: $_____.___

 

Fair Market Value of a Share on Date of Option Grant: $_____.___

 

Expiration Date: _____________, [YEAR] [DO NOT EXCEED TEN YEARS FROM GRANT OR FIVE YEARS FOR 10% SHAREHOLDER] This Option will expire earlier as a result of certain events, including your Termination of Service, as provided in this Agreement.

 

Vesting Calculation Date:

 

Vesting Schedule:

 

Subject to all the terms of this Agreement and your continuous status as a Service Provider through the applicable dates of vesting, your right to purchase Shares under this Option shall incrementally vest as to one-third of the total number of Shares covered by this Option, as shown above, on each of the second, third and fourth anniversaries of the Vesting Calculation Date.  In all cases, the resulting aggregate number of vested Shares will be rounded down to the nearest whole number. Except as provided below, upon your Termination Date, all of the then outstanding unvested portion of this Option shall be forfeited to the Company without consideration as of your Termination Date. Notwithstanding the foregoing, the total number of then unvested Shares subject to this Option shall become fully vested if either (i) there is a Change in Control and your status as a Service Provider is either terminated without Cause (as defined below) by the Company or is terminated by you for Good Reason (as defined below), in either case in anticipation of or within 24 months after the Change in Control or (ii) your status as a Service Provider is terminated (x) by the Company due to your Disability or (y) due to your death. Additionally, upon a Change in Control before the Optionee's Termination Date, the Option will be assumed or an equivalent option or right substituted by the successor corporation or a parent or subsidiary of the successor corporation. If the successor corporation refuses to assume or substitute the Option, then immediately before and contingent on the consummation of the Change in Control, the Optionee will fully vest in and have the right to exercise the Option. In addition, if the Option becomes fully vested and exercisable in lieu of assumption or substitution in the event of a Change in Control, the Administrator will notify the Optionee in writing or electronically that the Option will be fully vested and exercisable for a period determined by the Administrator in its sole discretion, and the Option will terminate upon the expiration of such period.

 

By signing this cover sheet, you agree to all of the terms and conditions described in this Agreement and in the Plan. You are also acknowledging receipt of this Agreement and a copy of the Plan and the Plan’s prospectus. Any inconsistency between this Agreement and the Plan shall be resolved by reference to the Plan.

 

Optionee:    
  (Signature)  
Company:    
  (Signature)  
Title:    

 

 

 

 

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Attachment

RADNET, INC.

2006 EQUITY INCENTIVE PLAN

 

INCENTIVE STOCK OPTION AGREEMENT

 

1. The Plan and
Other Agreements 		 

The text of the Plan is incorporated in this Agreement by reference. You and the Company agree to execute such further instruments and to take such further action as may reasonably be necessary to carry out the intent of this Agreement. Unless otherwise defined in this Agreement, certain capitalized terms used in this Agreement are defined in the Plan.

 

This Agreement and the Plan constitute the entire understanding between you and the Company regarding this Option. Any prior agreements, commitments or negotiations concerning this Option are superseded.

       
2. Award of Incentive Stock Option  

The Company awards you an Incentive Stock Option as shown on the cover sheet to this Agreement. This Option is intended to be an Incentive Stock Option under section 422 of the Code and will be interpreted accordingly.

 

If you cease to be an employee of the Company, a subsidiary corporation or of a parent corporation but continue to be a Service Provider, this Option will be treated as a Nonstatutory Stock Option on the day after the date that is three (3) months after you cease to be an employee of the Company (and any such subsidiary or any such parent): (i) even if you continue to be a Service Provider after your employment has terminated or (ii) if your termination of employment was for any reason other than due to your death or Disability. In addition, to the extent that all or part of this Option exceeds the $100,000 limitation rule of section 422(d) of the Code, this Option or the lesser excess part will be treated as a Nonstatutory Stock Option.

 

This Option is not intended to be deferred compensation under section 409A of the Code and will be interpreted accordingly.

       
3. Vesting  

This Option is only exercisable before it expires and only with respect to the vested portion of the Option. This Option will vest according to the Vesting Schedule described in the cover sheet of this Agreement.

 

The term "Cause" shall mean (1) the Optionee's theft, dishonesty, or falsification of any documents or records of the Company or any affiliate; (2) the Optionee's improper use or disclosure of confidential or proprietary information of the Company or any affiliate; (3) any action by the Optionee which has a detrimental effect on the reputation or business of the Company or any affiliate; (4) the Optionee's failure or inability to perform any reasonable assigned duties after written notice from the Company or an affiliate, and a reasonable opportunity to cure, such failure or inability; (5) any material breach by the Optionee of any employment or service agreement between the Optionee and the Company or an affiliate, which breach is not cured pursuant to the terms of such agreement; (6) the Optionee's conviction (including any plea of guilty or nolo contendere) of any criminal act which impairs the Optionee's ability to perform his or her duties with the Company or an affiliate; or (7) the Optionee's violation of a material Company policy.

 

The term "Good Reason" shall mean, as determined by the Administrator, (A) a material adverse change in the Optionee's title, stature, authority, or responsibilities with the Company (or the affiliate employing him or her); (B) a material reduction in the Optionee's base salary or annual bonus opportunity; or (C) receipt of notice by Optionee that the Optionee's principal workplace will be relocated by more than 50 miles. The Optionee must provide written notice (the “Good Reason Notice”) to the Company within 60 days of the initial existence of a Good Reason event or else the Optionee will have waived any ability to resign his/her service for Good Reason with respect to such event. The Company shall have 15 days after its receipt of the Good Reason Notice to cure or remedy the Good Reason event as determined by the Administrator such that Good Reason will no longer exist. If the Company fails to timely cure or remedy the Good Reason event then the Optionee must affirmatively resign his/her status as a Service Provider within 15 business days after the expiration of the foregoing 15 day cure/remedy period or else the Optionee will have waived any ability to resign his/her service for Good Reason with respect to such event.

 

 

 

 

  2  
 

 

       
4. Term   Your Option will expire in all cases no later than the close of business at Company headquarters on the Expiration Date, as shown on the cover sheet.  Your Option may expire earlier if your Service terminates, as described in Sections 5, 6 and 7 below or on the date on which the Option is cancelled (and not substituted or assumed) pursuant to a Change in Control or merger or acquisition or reorganization or similar transaction involving the Company. You are solely responsible for determining whether and when to exercise any vested portion of this Option and also for keeping track of when your Option expires and when it therefore can no longer be exercised. Except as otherwise expressly provided herein, the Company has no obligation (and does not intend) to provide you with any further notice of your Option’s expiration dates.  The Company will have no liability to you or to any other person if all or any portion of your Option is not exercised before it expires for any reason.
       
5. Termination of Service - General   If, while the Option is outstanding, your Termination Date occurs for any reason, other than being terminated by the Company for Cause or due to your death or Disability, then the unvested portion of your Option shall be forfeited without consideration and shall immediately expire on your Termination Date and the vested portion of your Option will expire at the earlier of (i) the close of business at Company headquarters on the date that is three (3) months after your Termination Date, (ii) the Expiration Date set forth in the attached cover sheet and further described in Section 4 above, or (iii) the date on which the Option is cancelled (and not substituted or assumed) pursuant to a Change in Control or merger or acquisition or reorganization or similar transaction involving the Company.  In no event is the Option exercisable after the Expiration Date.
       
6. Termination of Service for
Cause 		  If your Termination Date occurs because the Company terminated your service for Cause, then you shall immediately forfeit all rights to your Option without consideration, including any vested portion of the Option, and the entire Option shall immediately expire, and any rights, payments and benefits with respect to the Option shall be subject to reduction or recoupment in accordance with applicable Company policies and the Plan.  For avoidance of doubt, your Termination of Service shall also be deemed to have occurred because of a termination for Cause by the Company if, after your Termination Date, facts and circumstances are discovered that would have justified a termination for Cause, including, without limitation, your violation of Company policies or breach of confidentiality or other restrictive covenants or conditions that may apply to you prior to or after your Termination Date.
       
7. Termination of Service due to Death or Disability; Special Termination Provisions  

If your Termination Date occurs because of your death or Disability, then the unvested portion of your Option shall be forfeited without consideration and shall immediately expire on your Termination Date and the vested portion of your Option will expire at the earlier of (i) the close of business at Company headquarters on the date that is twelve (12) months after your Termination Date, (ii) the Expiration Date set forth in the attached cover sheet and further described in Section 4 above, or (iii) the date on which the Option is cancelled (and not substituted or assumed) pursuant to a Change in Control or merger or acquisition or reorganization or similar transaction involving the Company. In no event is the Option exercisable after the Expiration Date.

 

If a sale of Shares acquired upon the exercise of this Option within the applicable termination period set forth above would subject the Optionee to suit under Section 16(b) of the Exchange Act, this Option shall remain exercisable until the earliest to occur of (a) the tenth day following the date on which a sale of such Shares by the Optionee would no longer be subject to such suit, (b) the 190th day after the Optionee's Termination Date, or (c) the Expiration Date.

 

If exercise of the Option on the last day of the applicable termination period set forth in above is prevented by operation of the first paragraph of Section 14, then the vested portion of this Option shall remain exercisable until the earlier of (x) the 14th day after the first date that such paragraph in Section 14 no longer operates to prevent exercise of the Option or (y) the Expiration Date.

 

 

 

 

  3  
 

 

       
8. Notice of Exercise  

When you wish to exercise this Option, you must notify the Company by filing a “Notice of Exercise” form at the address given on the form. Your notice must specify how many Shares you wish to purchase. The notice can only become effective after it is received by the Company.

 

If someone else wants to exercise this Option after your death, that person must prove to the Company’s satisfaction that he or she is entitled to do so.

       
9. Form of Payment  

When you submit your notice of exercise, you must include payment of the aggregate Exercise Price for the Shares you are purchasing. Payment may be made in one (or a combination) of the following forms:

 

      · Cash, check, or wire transfer.
         
      · To the extent a public market for the Shares exists as determined by the Company, by Cashless Exercise through delivery (on a form prescribed by the Company) of an irrevocable direction to a securities broker to sell Shares and to deliver all or part of the sale proceeds to the Company in payment of the aggregate Exercise Price.
         
      · To the extent approved by the Administrator in its discretion and with all terms and conditions determined by the Administrator, payment may be made in another form of legal consideration acceptable to the Administrator.

 

10. Transfer of Award   Prior to your death, only you may exercise this Option. You cannot gift, transfer, assign, alienate, pledge, hypothecate, attach, sell, or encumber this Option. If you attempt to do any of these things, this Option will immediately become invalid. You may, however, dispose of this Option in your will or it may be transferred by the laws of descent and distribution. Regardless of any marital property settlement agreement, the Company is not obligated to honor a notice of exercise from your spouse, nor is the Company obligated to recognize your spouse’s interest in your Option in any other way.
       
11. Leaves of Absence  

For purposes of this Agreement, your status as a Service Provider does not terminate when you go on a bona fide leave of absence that was approved by the Company (or its parent, subsidiary or affiliate) in writing, if the terms of the leave provide for continued service crediting, or when continued service crediting is required by applicable law. Your status as a Service Provider terminates in any event when the approved leave ends, unless you immediately return to active service.

 

For income tax purposes, if the period of leave exceeds three (3) months and your right to reemployment is not provided either by statute or by contract, then this Option will be treated as a Nonstatutory Stock Option if the exercise of this Option occurs after the expiration of six (6) months from the commencement of such leave of absence.

 

The Company determines which leaves count for this purpose (along with determining the effect of a leave of absence on vesting of the Option), and when your status as a Service Provider terminates for all purposes under the Plan.

       
12. Stockholder Rights   You, or your estate, shall have no rights as a stockholder of the Company with regard to the Option until you have been issued the applicable Shares by the Company and have satisfied all other conditions specified in the Plan. No adjustment shall be made for cash or stock dividends or other rights for which the record date is prior to the date when such applicable Shares are issued, except as may be provided in the Plan.

 

 

 

 

  4  
 

 

       
13. Taxes and Withholding  

You will be solely responsible for payment of any and all applicable taxes, including without limitation any penalties or interest based upon such tax obligations, associated with this Award.

 

You will not be allowed to exercise this Option unless you make acceptable arrangements to pay any withholding or other taxes that may be due as a result of the Option exercise or sale of Shares acquired under this Option.

 

To the extent a public market for the Shares exists as determined by the Company, such withholding taxes may be settled by Cashless Exercise through delivery (on a form prescribed by the Company) of an irrevocable direction to a securities broker to sell Shares and to deliver all or part of the sale proceeds to the Company in payment of the withholding taxes.

 

To the extent approved by the Administrator in its discretion and with all terms and conditions determined by the Administrator, payment of withholding taxes may be made in another form of legal consideration acceptable to the Administrator.

       
       
14. Restrictions on Exercise and Resale  

The grant of this Option and the issuance of Shares upon exercise of this Option are subject to compliance with all Applicable Laws. This Option may not be exercised if the issuance of Shares upon exercise would constitute a violation of any Applicable Laws. In addition, this Option may not be exercised unless (i) a registration statement under the Securities Act of 1933, as amended (the "Securities Act") is in effect at the time of exercise of this Option with respect to the Shares; or (ii) in the opinion of legal counsel to the Company, the Shares issuable upon exercise of this Option may be issued in accordance with the terms of an applicable exemption from the registration requirements of the Securities Act. The Optionee is cautioned that unless the foregoing conditions are satisfied, the Optionee may not be able to exercise the Option when desired even though the Option is vested. As a further condition to the exercise of this Option, the Company may require the Optionee to satisfy any qualifications that may be necessary or appropriate, to evidence compliance with any Applicable Law or regulation and to make any representation or warranty with respect thereto as may be requested by the Company. Any Shares that are issued will be "restricted securities" as that term is defined in Rule 144 under the Securities Act, and will bear an appropriate restrictive legend, unless they are registered under the Securities Act. The Company is under no obligation to register the Shares issuable upon exercise of this Option.

 

By signing this Agreement, you agree not to (i) exercise this Option (“Exercise Prohibition”), or (ii) sell, transfer, dispose of, pledge, hypothecate, make any short sale of, or otherwise effect a similar transaction of any Shares acquired under this Option (each a “Sale Prohibition”) at a time when applicable laws, regulations or Company or underwriter trading policies prohibit the exercise or disposition of Shares. The Company will not permit you to exercise this Option if the issuance of Shares at that time would violate any law or regulation. The Company shall have the right to designate one or more periods of time, each of which generally will not exceed one hundred eighty (180) days in length (provided however, that such period may be extended in connection with the Company’s release (or announcement of release) of earnings results or other material news or events), and to impose an Exercise Prohibition and/or Sale Prohibition, if the Company determines (in its sole discretion) that such limitation(s) is needed in connection with a public offering of Shares or to comply with an underwriter’s request or trading policy, or could in any way facilitate a lessening of any restriction on transfer pursuant to the Securities Act or any state securities laws with respect to any issuance of securities by the Company, facilitate the registration or qualification of any securities by the Company under the Securities Act or any state securities laws, or facilitate the perfection of any exemption from the registration or qualification requirements of the Securities Act or any applicable state securities laws for the issuance or transfer of any securities. The Company may issue stop/transfer instructions and/or appropriately legend any stock certificates issued pursuant to this Option in order to ensure compliance with the foregoing. Any such Exercise Prohibition shall not alter the vesting schedule set forth in this Agreement other than to limit the periods during which this Option shall be exercisable.

 

 

 

  5  
 

 

      If the sale of Shares acquired under this Award is not registered under the Securities Act, but an exemption is available which requires an investment representation or other representation and warranty, you shall represent and agree that the Shares being acquired are being acquired for investment, and not with a view to the sale or distribution thereof, and shall make such other representations and warranties as are deemed necessary or appropriate by the Company and its counsel.
       
      If you sell or otherwise dispose of any of the Shares acquired pursuant to the exercise of this Option on or before the later of (i) the date that is two years after the Date of Option Grant or (ii) the date that is one year after the applicable exercise of this Option, then you shall within ten days of any and all such sales or dispositions provide the Company with written notice of such transactions including without limitation the date of each disposition, the number of Shares that you disposed of in each transaction and their original Date of Option Grant, and the amount of proceeds you received from each dispositiom.
       
15. No Retention Rights   Your Award or this Agreement does not give you the right to be retained by the Company (or any parent or any subsidiaries or affiliates) in any capacity.  The Company (or any parent and any subsidiaries or affiliates) reserves the right to terminate your status as a Service Provider at any time and for any reason.
       
16. Extraordinary Compensation  

This Award, and the Shares that may be released to you pursuant to this Award are not intended to constitute or replace any pension rights or compensation and are not to be considered compensation of a continuing or recurring nature, or part of your normal or expected compensation, and in no way represent any portion of your salary (if any), compensation or other remuneration for any purpose, including but not limited to, calculating any severance, resignation, termination, redundancy, dismissal, end of service payments, bonuses, long-service awards, pension or retirement benefits or similar payments.

 

17. Adjustments   In the event of a stock split, a stock dividend or a similar change in the Company stock, the number of outstanding Shares covered by this Option may be adjusted (and rounded down to the nearest whole number) pursuant to the Plan.  This Award shall be subject to the terms of the agreement of merger, liquidation or reorganization in the event the Company is subject to such corporate activity.
       
18. Legends  

All certificates representing any Shares issued under this Award may, where applicable, have endorsed thereon the following legends and any other legends the Company determines appropriate:

       
     

“THE SHARES REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO CERTAIN RESTRICTIONS ON TRANSFER AND OPTIONS TO PURCHASE SUCH SHARES SET FORTH IN AN AGREEMENT BETWEEN THE COMPANY AND THE REGISTERED HOLDER, OR HIS OR HER PREDECESSOR IN INTEREST. A COPY OF SUCH AGREEMENT IS ON FILE AT THE PRINCIPAL OFFICE OF THE COMPANY AND WILL BE FURNISHED UPON WRITTEN REQUEST TO THE SECRETARY OF THE COMPANY BY THE HOLDER OF RECORD OF THE SHARES REPRESENTED BY THIS CERTIFICATE.”

       
     

“THE SHARES REPRESENTED HEREBY HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, AND MAY NOT BE SOLD, PLEDGED, OR OTHERWISE TRANSFERRED WITHOUT AN EFFECTIVE REGISTRATION THEREOF UNDER SUCH ACT OR AN OPINION OF COUNSEL, SATISFACTORY TO THE COMPANY AND ITS COUNSEL, THAT SUCH REGISTRATION IS NOT REQUIRED.”

       
19. Applicable Law   This Agreement will be interpreted and enforced under the laws of the State of Delaware without reference to the conflicts of law provisions thereof.

 

 

 

 

  6  
 

 

       
20. Notice  

Any notice to be given or delivered to the Company relating to this Agreement shall be in writing and addressed to the Company at its principal corporate offices. Any notice to be given or delivered to you relating to this Agreement shall be in writing and addressed to you at such address of which you advise the Company in writing. All notices shall be deemed effective upon personal delivery or upon deposit in the U.S. mail, postage prepaid and properly addressed to the party to be notified.

 

The Optionee agrees that the Company may deliver all documents relating to the Plan or this Option (including prospectuses required by the Securities and Exchange Commission), and all other documents that the Company is required to deliver to its security holders or the Optionee (including annual reports, proxy statements and financial statements), either by e-mail or by e-mail notice of a Web site location where those documents have been posted. The Optionee may at any time (i) revoke this consent to e-mail delivery of those documents; (ii) update the e-mail address for delivery of those documents; (iii) obtain at no charge a paper copy of those documents, in each case by writing the Company at 1510 Cotner Ave., Los Angeles, CA 90025, Attention: General Counsel. The Optionee may request an electronic copy of any of those documents by requesting a copy from the General Counsel, 1510 Cotner Ave., Los Angeles, CA 90025. The Optionee understands that an e-mail account and appropriate hardware and software, including a computer or compatible cell phone and an Internet connection, will be required to access documents delivered by e-mail.

       
21. Voluntary Participant   You acknowledge that you are voluntarily participating in the Plan.
       
22. No Rights to Future Awards   Your rights, if any, in respect of or in connection with this Award or any other Awards are derived solely from the discretionary decision of the Company to permit you to participate in the Plan and to benefit from a discretionary future Award.  By accepting this Award, you expressly acknowledge that there is no obligation on the part of the Company to continue the Plan and/or grant any additional Awards to you or benefits in lieu of other Awards even if Awards have been granted repeatedly in the past. All decisions with respect to future Awards, if any, will be at the sole discretion of the Administrator.
       
23. Future Value   The future value of the underlying Shares is unknown and cannot be predicted with certainty.  If the underlying Shares do not increase in value (or decrease in value) after the Date of Option Grant, the Award could have little or no value.
       
24. No Advice Regarding Award   The Company has not provided any tax, legal or financial advice, nor has the Company made any recommendations regarding your participation in the Plan, or your acquisition or sale of the underlying Shares. You are hereby advised to consult with your own personal tax, legal and financial advisors regarding your participation in the Plan before taking any action related to the Plan or this Award.
       
25. No Right to Damages   You will have no right to bring a claim or to receive damages if any portion of the Award is cancelled or expires. The loss of existing or potential profit in the Award will not constitute an element of damages in the event of your Termination of Service for any reason, even if the termination is in violation of an obligation of the Company or a parent or a subsidiary or an affiliate to you.
       
26. Data Privacy   You hereby explicitly and unambiguously consent to the collection, use and transfer, in electronic or other form, of your personal data as described in this document by the Company for the exclusive purpose of implementing, administering and managing your participation in the Plan. You understand that the Company holds certain personal information about you, including, but not limited to, name, home address and telephone number, date of birth, social security or insurance number or other identification number, salary, nationality, job title, any shares of stock or directorships held in the Company, details of all Awards or any other entitlement to Shares awarded, cancelled, purchased, exercised, vested, unvested or outstanding in your favor for the purpose of implementing, managing and administering the Plan (“Data”). You understand that the Data may be transferred to any third parties assisting in the implementation, administration and management of the Plan, that these recipients may be located in your country or elsewhere and that the recipient country may have different data privacy laws and protections than your country. You authorize the recipients to receive, possess, use, retain and transfer the Data, in electronic or other form, for the purposes of implementing, administering and managing your participation in the Plan, including any requisite transfer of such Data, as may be required to a broker or other third party with whom you may elect to deposit any Shares acquired under the Plan.  

 

 

 

 

 

  7  
 

 

RADNET, INC.
NOTICE OF EXERCISE OF INCENTIVE STOCK OPTION BY OPTIONEE

 

Radnet, Inc.

1510 Cotner Ave.

Los Angeles, CA 90025
Attention: Secretary

 

Re; Exercise of Incentive Stock Option to Purchase Shares of Company Stock

  

     
  [PRINT NAME OF OPTIONEE]  

 

Pursuant to the Incentive Stock Option Agreement dated ___________________, ______ between Radnet Inc., a Delaware corporation, (the “Company”) and me, made pursuant to the 2006 Equity Incentive Plan (the “Plan”), I hereby request to purchase _______ Shares (whole number only and must be not less than one hundred (100) Shares or the remaining number of vested Shares subject to this Option) of common stock of the Company (the “Shares”), at the exercise price of $__________ per Share. I am hereby making full payment of the aggregate exercise price by one or more of the following forms of payment in accordance with the whole number percentages that I have provided below. I further understand and agree that I will timely satisfy any and all applicable tax withholding obligations as a condition of this Option exercise.

 

  Percentage
of Payment 		  Form of Payment As Provided In the Incentive Stock Option Agreement
       
  ____________%   Cash, check, or wire trransfer
       
  ____________%   Cashless Exercise
          100%    

 

I acknowledge that I have received, understand and continue to be bound by all of the terms and conditions set forth in the Plan, Plan prospectus and in the Incentive Stock Option Agreement.

 

Dated: __________________

 

_________________________________________

(Optionee’s Signature)

 

 

_________________________________________

 

_________________________________________

(Full Address)

 

 

* THIS NOTICE OF EXERCISE MAY BE REVISED BY THE COMPANY AT ANY TIME WITHOUT NOTICE.

 

 

 

  8  

 

EXHIBIT 99.3

  

RADNET, INC.

2006 EQUITY INCENTIVE PLAN

 

NONSTATUTORY STOCK OPTION AGREEMENT

 

Radnet, Inc., a Delaware corporation, (the “Company”), hereby grants an Option to purchase Shares to the Optionee named below. The terms and conditions of the Option are set forth in this cover sheet and the attached Nonstatutory Stock Option Agreement (together, this “Agreement”) and in the Radnet Inc. 2006 Equity Incentive Plan as it may be amended from time to time.

 

Date of Option Grant: __________________, [YEAR]

 

Name of Optionee (“you”, “your”, or “Optionee”): ______________________________________________

 

Number of Shares Covered by Option: ______________

 

Exercise Price per Share: $_____.___

 

Fair Market Value of a Share on Date of Option Grant: $_____.___

 

Expiration Date: _____________, [YEAR] [DO NOT EXCEED TEN YEARS FROM GRANT] This Option will expire earlier as a result of certain events, including your Termination of Service, as provided in this Agreement.

 

Vesting Calculation Date:

 

Vesting Schedule:

 

Subject to all the terms of this Agreement and your continuous status as a Service Provider through the applicable dates of vesting, your right to purchase Shares under this Option shall incrementally vest as to one-third of the total number of Shares covered by this Option, as shown above, on each of the second, third and fourth anniversaries of the Vesting Calculation Date.  In all cases, the resulting aggregate number of vested Shares will be rounded down to the nearest whole number. Except as provided below, upon your Termination Date, all of the then outstanding unvested portion of this Option shall be forfeited to the Company without consideration as of your Termination Date. Notwithstanding the foregoing, the total number of then unvested Shares subject to this Option shall become fully vested if either (i) there is a Change in Control and your status as a Service Provider is either terminated without Cause (as defined below) by the Company or is terminated by you for Good Reason (as defined below), in either case in anticipation of or within 24 months after the Change in Control or (ii) your status as a Service Provider is terminated (x) by the Company due to your Disability or (y) due to your death. Additionally, upon a Change in Control before the Optionee's Termination Date, the Option will be assumed or an equivalent option or right substituted by the successor corporation or a parent or subsidiary of the successor corporation. If the successor corporation refuses to assume or substitute the Option, then immediately before and contingent on the consummation of the Change in Control, the Optionee will fully vest in and have the right to exercise the Option. In addition, if the Option becomes fully vested and exercisable in lieu of assumption or substitution in the event of a Change in Control, the Administrator will notify the Optionee in writing or electronically that the Option will be fully vested and exercisable for a period determined by the Administrator in its sole discretion, and the Option will terminate upon the expiration of such period.

 

By signing this cover sheet, you agree to all of the terms and conditions described in this Agreement and in the Plan. You are also acknowledging receipt of this Agreement and a copy of the Plan and the Plan’s prospectus. Any inconsistency between this Agreement and the Plan shall be resolved by reference to the Plan.

 

Optionee:    
  (Signature)  
Company:    
  (Signature)  
Title:    

 

 

 

  1  
 



Attachment

RADNET, INC.

 

2006 EQUITY INCENTIVE PLAN

NONSTATUTORY STOCK OPTION AGREEMENT

 

1. The Plan and
Other Agreements 		 

The text of the Plan is incorporated in this Agreement by reference. You and the Company agree to execute such further instruments and to take such further action as may reasonably be necessary to carry out the intent of this Agreement. Unless otherwise defined in this Agreement, certain capitalized terms used in this Agreement are defined in the Plan.

 

This Agreement and the Plan constitute the entire understanding between you and the Company regarding this Option. Any prior agreements, commitments or negotiations concerning this Option are superseded.

       
2. Award of Nonstatutory Stock Option  

The Company awards you a Nonstatutory Stock Option as shown on the cover sheet to this Agreement. This Option is not intended to be an Incentive Stock Option under section 422 of the Code and will be interpreted accordingly.

 

This Option is not intended to be deferred compensation under section 409A of the Code and will be interpreted accordingly.

       
3. Vesting  

This Option is only exercisable before it expires and only with respect to the vested portion of the Option. This Option will vest according to the Vesting Schedule described in the cover sheet of this Agreement.

 

The term "Cause" shall mean (1) the Optionee's theft, dishonesty, or falsification of any documents or records of the Company or any affiliate; (2) the Optionee's improper use or disclosure of confidential or proprietary information of the Company or any affiliate; (3) any action by the Optionee which has a detrimental effect on the reputation or business of the Company or any affiliate; (4) the Optionee's failure or inability to perform any reasonable assigned duties after written notice from the Company or an affiliate, and a reasonable opportunity to cure, such failure or inability; (5) any material breach by the Optionee of any employment or service agreement between the Optionee and the Company or an affiliate, which breach is not cured pursuant to the terms of such agreement; (6) the Optionee's conviction (including any plea of guilty or nolo contendere) of any criminal act which impairs the Optionee's ability to perform his or her duties with the Company or an affiliate; or (7) the Optionee's violation of a material Company policy.

 

The term "Good Reason" shall mean, as determined by the Administrator, (A) a material adverse change in the Optionee's title, stature, authority, or responsibilities with the Company (or the affiliate employing him or her); (B) a material reduction in the Optionee's base salary or annual bonus opportunity; or (C) receipt of notice by Optionee that the Optionee's principal workplace will be relocated by more than 50 miles. The Optionee must provide written notice (the “Good Reason Notice”) to the Company within 60 days of the initial existence of a Good Reason event or else the Optionee will have waived any ability to resign his/her service for Good Reason with respect to such event. The Company shall have 15 days after its receipt of the Good Reason Notice to cure or remedy the Good Reason event as determined by the Administrator such that Good Reason will no longer exist. If the Company fails to timely cure or remedy the Good Reason event then the Optionee must affirmatively resign his/her status as a Service Provider within 15 business days after the expiration of the foregoing 15 day cure/remedy period or else the Optionee will have waived any ability to resign his/her service for Good Reason with respect to such event.

 

 

 

 

  2  
 

 

       
4. Term   Your Option will expire in all cases no later than the close of business at Company headquarters on the Expiration Date, as shown on the cover sheet.  Your Option may expire earlier if your Service terminates, as described in Sections 5, 6 and 7 below or on the date on which the Option is cancelled (and not substituted or assumed) pursuant to a Change in Control or merger or acquisition or reorganization or similar transaction involving the Company.  You are solely responsible for determining whether and when to exercise any vested portion of this Option and also for keeping track of when your Option expires and when it therefore can no longer be exercised.  Except as otherwise expressly provided herein, the Company has no obligation (and does not intend) to provide you with any further notice of your Option’s expiration dates.  The Company will have no liability to you or to any other person if all or any portion of your Option is not exercised before it expires for any reason.
       
5. Termination of Service - General   If, while the Option is outstanding, your Termination Date occurs for any reason, other than being terminated by the Company for Cause or due to your death or Disability, then the unvested portion of your Option shall be forfeited without consideration and shall immediately expire on your Termination Date and the vested portion of your Option will expire at the earlier of (i) the close of business at Company headquarters on the date that is three (3) months after your Termination Date, (ii) the Expiration Date set forth in the attached cover sheet and further described in Section 4 above, or (iii) the date on which the Option is cancelled (and not substituted or assumed) pursuant to a Change in Control or merger or acquisition or reorganization or similar transaction involving the Company. In no event is the Option exercisable after the Expiration Date.
       
6. Termination of Service for
Cause 		  If your Termination Date occurs because the Company terminated your service for Cause, then you shall immediately forfeit all rights to your Option without consideration, including any vested portion of the Option, and the entire Option shall immediately expire, and any rights, payments and benefits with respect to the Option shall be subject to reduction or recoupment in accordance with applicable Company policies and the Plan.  For avoidance of doubt, your Termination of Service shall also be deemed to have occurred because of a termination for Cause by the Company if, after your Termination Date, facts and circumstances are discovered that would have justified a termination for Cause, including, without limitation, your violation of Company policies or breach of confidentiality or other restrictive covenants or conditions that may apply to you prior to or after your Termination Date.
       
7. Termination of Service due to Death or Disability; Special Termination Provisions  

If your Termination Date occurs because of your death or Disability, then the unvested portion of your Option shall be forfeited without consideration and shall immediately expire on your Termination Date and the vested portion of your Option will expire at the earlier of (i) the close of business at Company headquarters on the date that is twelve (12) months after your Termination Date, (ii) the Expiration Date set forth in the attached cover sheet and further described in Section 4 above, or (iii) the date on which the Option is cancelled (and not substituted or assumed) pursuant to a Change in Control or merger or acquisition or reorganization or similar transaction involving the Company. In no event is the Option exercisable after the Expiration Date.

 

If a sale of Shares acquired upon the exercise of this Option within the applicable termination period set forth above would subject the Optionee to suit under Section 16(b) of the Exchange Act, this Option shall remain exercisable until the earliest to occur of (a) the tenth day following the date on which a sale of such Shares by the Optionee would no longer be subject to such suit, (b) the 190th day after the Optionee's Termination Date, or (c) the Expiration Date.

 

If exercise of the Option on the last day of the applicable termination period set forth in above is prevented by operation of the first paragraph of Section 14, then the vested portion of this Option shall remain exercisable until the earlier of (x) the 14th day after the first date that such paragraph in Section 14 no longer operates to prevent exercise of the Option or (y) the Expiration Date.

 

 

 

 

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8. Notice of Exercise  

When you wish to exercise this Option, you must notify the Company by filing a “Notice of Exercise” form at the address given on the form. Your notice must specify how many Shares you wish to purchase. The notice can only become effective after it is received by the Company.

 

If someone else wants to exercise this Option after your death, that person must prove to the Company’s satisfaction that he or she is entitled to do so.

       
9. Form of Payment  

When you submit your notice of exercise, you must include payment of the aggregate Exercise Price for the Shares you are purchasing. Payment may be made in one (or a combination) of the following forms:

 

      · Cash, check, or wire transfer.
         
      · To the extent a public market for the Shares exists as determined by the Company, by Cashless Exercise through delivery (on a form prescribed by the Company) of an irrevocable direction to a securities broker to sell Shares and to deliver all or part of the sale proceeds to the Company in payment of the aggregate Exercise Price.
         
      · To the extent approved by the Administrator in its discretion and with all terms and conditions determined by the Administrator, payment may be made in another form of legal consideration acceptable to the Administrator.

       
10. Transfer of Award  

Prior to your death, only you may exercise this Option. You cannot gift, transfer, assign, alienate, pledge, hypothecate, attach, sell, or encumber this Option. If you attempt to do any of these things, this Option will immediately become invalid. You may, however, dispose of this Option in your will or it may be transferred by the laws of descent and distribution. Regardless of any marital property settlement agreement, the Company is not obligated to honor a notice of exercise from your spouse, nor is the Company obligated to recognize your spouse’s interest in your Option in any other way.

 

11. Leaves of Absence  

For purposes of this Agreement, your status as a Service Provider does not terminate when you go on a bona fide leave of absence that was approved by the Company (or its parent, subsidiary or affiliate) in writing, if the terms of the leave provide for continued service crediting, or when continued service crediting is required by applicable law. Your status as a Service Provider terminates in any event when the approved leave ends, unless you immediately return to active service.

 

The Company determines which leaves count for this purpose (along with determining the effect of a leave of absence on vesting of the Option), and when your status as a Service Provider terminates for all purposes under the Plan.

       
12. Stockholder Rights   You, or your estate, shall have no rights as a stockholder of the Company with regard to the Option until you have been issued the applicable Shares by the Company and have satisfied all other conditions specified in the Plan. No adjustment shall be made for cash or stock dividends or other rights for which the record date is prior to the date when such applicable Shares are issued, except as may be provided in the Plan.

 

 

 

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13. Taxes and Withholding  

You will be solely responsible for payment of any and all applicable taxes, including without limitation any penalties or interest based upon such tax obligations, associated with this Award.

 

You will not be allowed to exercise this Option unless you make acceptable arrangements to pay any withholding or other taxes that may be due as a result of the Option exercise or sale of Shares acquired under this Option.

 

To the extent a public market for the Shares exists as determined by the Company, such withholding taxes may be settled by Cashless Exercise through delivery (on a form prescribed by the Company) of an irrevocable direction to a securities broker to sell Shares and to deliver all or part of the sale proceeds to the Company in payment of the withholding taxes.

 

To the extent approved by the Administrator in its discretion and with all terms and conditions determined by the Administrator, payment of withholding taxes may be made in another form of legal consideration acceptable to the Administrator.

       
14. Restrictions on Exercise and Resale  

The grant of this Option and the issuance of Shares upon exercise of this Option are subject to compliance with all Applicable Laws. This Option may not be exercised if the issuance of Shares upon exercise would constitute a violation of any Applicable Laws. In addition, this Option may not be exercised unless (i) a registration statement under the Securities Act of 1933, as amended (the "Securities Act") is in effect at the time of exercise of this Option with respect to the Shares; or (ii) in the opinion of legal counsel to the Company, the Shares issuable upon exercise of this Option may be issued in accordance with the terms of an applicable exemption from the registration requirements of the Securities Act. The Optionee is cautioned that unless the foregoing conditions are satisfied, the Optionee may not be able to exercise the Option when desired even though the Option is vested. As a further condition to the exercise of this Option, the Company may require the Optionee to satisfy any qualifications that may be necessary or appropriate, to evidence compliance with any Applicable Law or regulation and to make any representation or warranty with respect thereto as may be requested by the Company. Any Shares that are issued will be "restricted securities" as that term is defined in Rule 144 under the Securities Act, and will bear an appropriate restrictive legend, unless they are registered under the Securities Act. The Company is under no obligation to register the Shares issuable upon exercise of this Option.

 

By signing this Agreement, you agree not to (i) exercise this Option (“Exercise Prohibition”), or (ii) sell, transfer, dispose of, pledge, hypothecate, make any short sale of, or otherwise effect a similar transaction of any Shares acquired under this Option (each a “Sale Prohibition”) at a time when applicable laws, regulations or Company or underwriter trading policies prohibit the exercise or disposition of Shares. The Company will not permit you to exercise this Option if the issuance of Shares at that time would violate any law or regulation. The Company shall have the right to designate one or more periods of time, each of which generally will not exceed one hundred eighty (180) days in length (provided however, that such period may be extended in connection with the Company’s release (or announcement of release) of earnings results or other material news or events), and to impose an Exercise Prohibition and/or Sale Prohibition, if the Company determines (in its sole discretion) that such limitation(s) is needed in connection with a public offering of Shares or to comply with an underwriter’s request or trading policy, or could in any way facilitate a lessening of any restriction on transfer pursuant to the Securities Act or any state securities laws with respect to any issuance of securities by the Company, facilitate the registration or qualification of any securities by the Company under the Securities Act or any state securities laws, or facilitate the perfection of any exemption from the registration or qualification requirements of the Securities Act or any applicable state securities laws for the issuance or transfer of any securities. The Company may issue stop/transfer instructions and/or appropriately legend any stock certificates issued pursuant to this Option in order to ensure compliance with the foregoing. Any such Exercise Prohibition shall not alter the vesting schedule set forth in this Agreement other than to limit the periods during which this Option shall be exercisable.

       
      If the sale of Shares acquired under this Award is not registered under the Securities Act, but an exemption is available which requires an investment representation or other representation and warranty, you shall represent and agree that the Shares being acquired are being acquired for investment, and not with a view to the sale or distribution thereof, and shall make such other representations and warranties as are deemed necessary or appropriate by the Company and its counsel.

 

 

 

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15. No Retention Rights   Your Award or this Agreement does not give you the right to be retained by the Company (or any parent or any subsidiaries or affiliates) in any capacity.  The Company (or any parent and any subsidiaries or affiliates) reserves the right to terminate your status as a Service Provider at any time and for any reason.
       
16. Extraordinary Compensation   This Award, and the Shares that may be released to you pursuant to this Award are not intended to constitute or replace any pension rights or compensation and are not to be considered compensation of a continuing or recurring nature, or part of your normal or expected compensation, and in no way represent any portion of your salary (if any), compensation or other remuneration for any purpose, including but not limited to, calculating any severance, resignation, termination, redundancy, dismissal, end of service payments, bonuses, long-service awards, pension or retirement benefits or similar payments.
       
17. Adjustments   In the event of a stock split, a stock dividend or a similar change in the Company stock, the number of outstanding Shares covered by this Option may be adjusted (and rounded down to the nearest whole number) pursuant to the Plan. This Award shall be subject to the terms of the agreement of merger, liquidation or reorganization in the event the Company is subject to such corporate activity.
       
18. Legends  

All certificates representing any Shares issued under this Award may, where applicable, have endorsed thereon the following legends and any other legends the Company determines appropriate:

       
     

“THE SHARES REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO CERTAIN RESTRICTIONS ON TRANSFER AND OPTIONS TO PURCHASE SUCH SHARES SET FORTH IN AN AGREEMENT BETWEEN THE COMPANY AND THE REGISTERED HOLDER, OR HIS OR HER PREDECESSOR IN INTEREST. A COPY OF SUCH AGREEMENT IS ON FILE AT THE PRINCIPAL OFFICE OF THE COMPANY AND WILL BE FURNISHED UPON WRITTEN REQUEST TO THE SECRETARY OF THE COMPANY BY THE HOLDER OF RECORD OF THE SHARES REPRESENTED BY THIS CERTIFICATE.”

       
     

“THE SHARES REPRESENTED HEREBY HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, AND MAY NOT BE SOLD, PLEDGED, OR OTHERWISE TRANSFERRED WITHOUT AN EFFECTIVE REGISTRATION THEREOF UNDER SUCH ACT OR AN OPINION OF COUNSEL, SATISFACTORY TO THE COMPANY AND ITS COUNSEL, THAT SUCH REGISTRATION IS NOT REQUIRED.”

       
19. Applicable Law   This Agreement will be interpreted and enforced under the laws of the State of Delaware without reference to the conflicts of law provisions thereof.
       
20. Notice  

Any notice to be given or delivered to the Company relating to this Agreement shall be in writing and addressed to the Company at its principal corporate offices. Any notice to be given or delivered to you relating to this Agreement shall be in writing and addressed to you at such address of which you advise the Company in writing. All notices shall be deemed effective upon personal delivery or upon deposit in the U.S. mail, postage prepaid and properly addressed to the party to be notified.

 

The Optionee agrees that the Company may deliver all documents relating to the Plan or this Option (including prospectuses required by the Securities and Exchange Commission), and all other documents that the Company is required to deliver to its security holders or the Optionee (including annual reports, proxy statements and financial statements), either by e-mail or by e-mail notice of a Web site location where those documents have been posted. The Optionee may at any time (i) revoke this consent to e-mail delivery of those documents; (ii) update the e-mail address for delivery of those documents; (iii) obtain at no charge a paper copy of those documents, in each case by writing the Company at 1510 Cotner Ave., Los Angeles, CA 90025, Attention: General Counsel. The Optionee may request an electronic copy of any of those documents by requesting a copy from the General Counsel, 1510 Cotner Ave., Los Angeles, CA 90025. The Optionee understands that an e-mail account and appropriate hardware and software, including a computer or compatible cell phone and an Internet connection, will be required to access documents delivered by e-mail.

 

 

 

 

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21. Voluntary Participant   You acknowledge that you are voluntarily participating in the Plan.
       
22. No Rights to Future Awards   Your rights, if any, in respect of or in connection with this Award or any other Awards are derived solely from the discretionary decision of the Company to permit you to participate in the Plan and to benefit from a discretionary future Award. By accepting this Award, you expressly acknowledge that there is no obligation on the part of the Company to continue the Plan and/or grant any additional Awards to you or benefits in lieu of other Awards even if Awards have been granted repeatedly in the past. All decisions with respect to future Awards, if any, will be at the sole discretion of the Administrator.
       
23. Future Value   The future value of the underlying Shares is unknown and cannot be predicted with certainty.  If the underlying Shares do not increase in value (or decrease in value) after the Date of Option Grant, the Award could have little or no value.
       
24. No Advice Regarding Award   The Company has not provided any tax, legal or financial advice, nor has the Company made any recommendations regarding your participation in the Plan, or your acquisition or sale of the underlying Shares. You are hereby advised to consult with your own personal tax, legal and financial advisors regarding your participation in the Plan before taking any action related to the Plan or this Award.
       
25. No Right to Damages   You will have no right to bring a claim or to receive damages if any portion of the Award is cancelled or expires. The loss of existing or potential profit in the Award will not constitute an element of damages in the event of your Termination of Service for any reason, even if the termination is in violation of an obligation of the Company or a parent or a subsidiary or an affiliate to you.
       
26. Data Privacy   You hereby explicitly and unambiguously consent to the collection, use and transfer, in electronic or other form, of your personal data as described in this document by the Company for the exclusive purpose of implementing, administering and managing your participation in the Plan. You understand that the Company holds certain personal information about you, including, but not limited to, name, home address and telephone number, date of birth, social security or insurance number or other identification number, salary, nationality, job title, any shares of stock or directorships held in the Company, details of all Awards or any other entitlement to Shares awarded, cancelled, purchased, exercised, vested, unvested or outstanding in your favor for the purpose of implementing, managing and administering the Plan (“Data”). You understand that the Data may be transferred to any third parties assisting in the implementation, administration and management of the Plan, that these recipients may be located in your country or elsewhere and that the recipient country may have different data privacy laws and protections than your country. You authorize the recipients to receive, possess, use, retain and transfer the Data, in electronic or other form, for the purposes of implementing, administering and managing your participation in the Plan, including any requisite transfer of such Data, as may be required to a broker or other third party with whom you may elect to deposit any Shares acquired under the Plan.

 

 

 

 

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RADNET, INC.
NOTICE OF EXERCISE OF NONSTATUTORY STOCK OPTION BY OPTIONEE

 

 

Radnet, Inc.

1510 Cotner Ave.

Los Angeles, CA 90025
Attention: Secretary

 

Re; Exercise of Nonstatutory Stock Option to Purchase Shares of Company Stock

  

     
  [PRINT NAME OF OPTIONEE]  

 

Pursuant to the Nonstatutory Stock Option Agreement dated ___________________, ______ between Radnet Inc., a Delaware corporation, (the “Company”) and me, made pursuant to the 2006 Equity Incentive Plan (the “Plan”), I hereby request to purchase _______ Shares (whole number only and must be not less than one hundred (100) Shares or the remaining number of vested Shares subject to this Option) of common stock of the Company (the “Shares”), at the exercise price of $__________ per Share. I am hereby making full payment of the aggregate exercise price by one or more of the following forms of payment in accordance with the whole number percentages that I have provided below. I further understand and agree that I will timely satisfy any and all applicable tax withholding obligations as a condition of this Option exercise.

 

  Percentage
of Payment 		  Form of Payment As Provided In the Nonstatutory Stock Option Agreement
       
  ____________%   Cash, check, or wire trransfer
       
  ____________%   Cashless Exercise
          100%    

 

I acknowledge that I have received, understand and continue to be bound by all of the terms and conditions set forth in the Plan, Plan prospectus and in the Incentive Stock Option Agreement.

 

Dated: __________________

 

_________________________________________

(Optionee’s Signature)

 

 

_________________________________________

 

_________________________________________

(Full Address)

 

 

* THIS NOTICE OF EXERCISE MAY BE REVISED BY THE COMPANY AT ANY TIME WITHOUT NOTICE.

 

 

  8  

 

EXHIBIT 99.4

 

RADNET, INC.

2006 EQUITY INCENTIVE PLAN

 

STOCK AWARD AGREEMENT

 

The Company hereby awards a Stock Award (the “Restricted Stock”) to the Awardee named below. The terms and conditions of the Stock Award are set forth in this cover sheet and the attached Stock Award Agreement and in the Plan. This cover sheet is incorporated into and a part of the attached Stock Award Agreement (together, the “Agreement”).

 

Date of Award :

 

Name of Awardee (“you”, “your”, “Awardee”): :

 

Number of Shares of Restricted Stock Awarded :

 

Amount Paid by Awardee for the Shares of Restricted Stock Awarded :         $ 0.00

 

Fair Market Value of a Share on Date of Award :       $

 

Vesting Calculation Date :

 

Vesting Schedule:

 

As long as you continuously are a Service Provider, you will become incrementally vested as to one-third of the total number of Shares awarded (rounded to the nearest whole number), as shown above, on each of the Vesting Calculation Date and on each of the first two anniversaries of the Vesting Calculation Date. In the event that you cease to be a Service Provider, you will forfeit to the Company without consideration all of the then-unvested Shares subject to this Award. However, the total number of then unvested Shares subject to this Award shall become fully vested if either (i) there is a Change in Control and your status as a Service Provider is either terminated without Cause (as defined below) by the Company or is terminated by you for Good Reason (as defined below), in either case in anticipation of or within 24 months after the Change in Control or (ii) your status as a Service Provider is terminated (x) by the Company due to your Disability or (y) due to your death.

 

By signing this cover sheet, you agree to all terms and conditions described in the attached Stock Award Agreement and in the Plan and Plan prospectus. You specifically acknowledge that you have carefully read the section entitled "Code Section 83(b) Election" and the Exhibit B attachment and you further acknowledge that you are solely responsible for filing any Code Section 83(b) election, and that such election must be filed within thirty (30) days after the Date of Award in order to be effective. You are also acknowledging receipt of this Agreement and copies of the Plan and its prospectus.

 

 

Company:   Awardee:
       
By:      
Its:      

 

 

 

 

 

 

 

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Attachments

 

RADNET, INC.

2006 EQUITY INCENTIVE PLAN

 

STOCK AWARD AGREEMENT

 

The Plan and Other Agreements  

The text of the Plan is incorporated in this Agreement by this reference. You and the Company agree to execute such further instruments and to take such further action as may reasonably be necessary to carry out the intent of this Agreement. Unless otherwise defined in this Agreement, certain capitalized terms used in this Agreement are defined in the Plan.

 

This Agreement, the attached Exhibits and the Plan constitute the entire understanding between you and the Company regarding this Award of Restricted Stock. Any prior agreements, commitments or negotiations are superseded .

     
Award of Restricted Stock   The Company awards you the number of Shares of Restricted Stock shown on the cover sheet of this Agreement. The Award is subject to the terms and conditions of this Agreement and the Plan.  This Award is not intended to constitute a nonqualified deferred compensation plan within the meaning of section 409A of the Code and will be interpreted accordingly .
     
Vesting  

This Award will vest according to the Vesting Schedule on the attached cover sheet and also the below paragraph of this section.

 

The term "Cause" shall mean (1) the Awardee's theft, dishonesty, or falsification of any documents or records of the Company or any affiliate; (2) the Awardee's improper use or disclosure of confidential or proprietary information of the Company or any affiliate; (3) any action by the Awardee which has a detrimental effect on the reputation or business of the Company or any affiliate; (4) the Awardee's failure or inability to perform any reasonable assigned duties after written notice from the Company or an affiliate, and a reasonable opportunity to cure, such failure or inability; (5) any material breach by the Awardee of any employment or service agreement between the Awardee and the Company or an affiliate, which breach is not cured pursuant to the terms of such agreement; (6) the Awardee's conviction (including any plea of guilty or nolo contendere) of any criminal act which impairs the Awardee's ability to perform his or her duties with the Company or an affiliate; or (7) the Awardee's violation of a material Company policy.

 

The term "Good Reason" shall mean, as determined by the Administrator, (A) a material adverse change in the Awardee's title, stature, authority, or responsibilities with the Company (or the affiliate employing him or her); (B) a material reduction in the Awardee's base salary or annual bonus opportunity; or (C) receipt of notice by Awardee that the Awardee's principal workplace will be relocated by more than 50 miles. The Awardee must provide written notice (the “Good Reason Notice”) to the Company within 60 days of the initial existence of a Good Reason event or else the Awardee will have waived any ability to resign his/her service for Good Reason with respect to such event. The Company shall have 15 days after its receipt of the Good Reason Notice to cure or remedy the Good Reason event as determined by the Administrator such that Good Reason will no longer exist. If the Company fails to timely cure or remedy the Good Reason event then the Awardee must affirmatively resign his/her status as a Service Provider within 15 business days after the expiration of the foregoing 15 day cure/remedy period or else the Awardee will have waived any ability to resign his/her service for Good Reason with respect to such event.

 

 

 

 

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Escrow   The certificate(s) for the Restricted Stock shall be deposited in escrow with the Secretary of the Company (or his/her designee) to be held in accordance with the provisions of this paragraph.  Each deposited certificate shall be accompanied by a duly executed Assignment Separate from Certificate in the form attached hereto as Exhibit A.  The deposited certificates shall remain in escrow until such time as the certificates are to be released or otherwise surrendered for cancellation as discussed below.  Upon delivery of the certificates to the Company, you shall be issued an instrument of deposit acknowledging the number of Shares of Restricted Stock delivered in escrow to the Secretary of the Company.
     
   

All regular cash or stock dividends, if any, on the Restricted Stock shall be held in escrow and shall be subject to the same vesting conditions provided in this Agreement.

 

The Restricted Stock held in escrow hereunder shall be subject to the following terms and conditions relating to their release from escrow or their surrender to the Company, provided, however, that the minimum number of Shares released to you in any individual release of Share certificates must be at least twenty-five (25) Shares (unless the release represents your final release of Share certificates from escrow):

 

    · When your interest in the Restricted Stock vests, the certificates for such vested Restricted Stock (and related dividends) shall be released from escrow and delivered to you. Upon your Termination of Service for any reason prior to vesting and in which no vesting is provided upon such termination, any unvested Restricted Stock (and dividends) subject to this Agreement shall be immediately surrendered to the Company.

 

No Assignment   The Shares subject to this Award shall not be sold, anticipated, assigned, attached, garnished, optioned, transferred or made subject to any creditor’s process, whether voluntarily, involuntarily or by operation of law.  However, this shall not preclude a transfer of vested Shares by will or by the laws of descent and distribution.  In addition, pursuant to Company procedures, you may designate a beneficiary who will receive any outstanding vested Shares in the event of your death. Regardless of any marital property settlement agreement, the Company is not obligated to recognize your spouse’s interest in your Award in any way.
     
Code Section 83(b) Election   You represent and warrant that you understand the Federal, state and local income tax consequences of the granting of this Restricted Stock. Under Section 83 of the Code, the Fair Market Value of the Restricted Stock on the date any forfeiture restrictions applicable to such Restricted Stock lapse will be reportable as ordinary income at that time. For this purpose, “forfeiture restrictions” include surrender to the Company of unvested Restricted Stock as described above. You may voluntarily elect to be taxed at the time the Restricted Stock is acquired to the extent that the Fair Market Value of the Restricted Stock exceeds the amount of consideration paid by you (if any) for such Restricted Stock at that time rather than when such Restricted Stock ceases to be subject to such forfeiture restrictions, by filing an election under Section 83(b) of the Code with the Internal Revenue Service within thirty (30) days after the Date of Award.  A form for making this election is attached as Exhibit B hereto.  Failure to make this filing within the thirty (30) day period will result in the recognition of ordinary income by you as the forfeiture restrictions lapse.  YOU ACKNOWLEDGE THAT IT IS YOUR SOLE RESPONSIBILITY, AND NOT THE COMPANY’S, TO FILE A TIMELY ELECTION UNDER CODE SECTION 83(b), EVEN IF YOU REQUEST THE COMPANY OR ITS REPRESENTATIVES TO MAKE THIS FILING ON YOUR BEHALF.  MOREOVER, YOU ARE RELYING SOLELY ON YOUR OWN ADVISORS WITH RESPECT TO THE DECISION AS TO WHETHER OR NOT TO FILE A CODE SECTION 83(b) ELECTION.
     
Leaves of Absence  

For purposes of this Agreement, your status as a Service Provider does not terminate when you go on a bona fide leave of absence that was approved by the Company (or its parent, subsidiary or affiliate) in writing, if the terms of the leave provide for continued service crediting, or when continued service crediting is required by applicable law. Your status as a Service Provider terminates in any event when the approved leave ends, unless you immediately return to active service.

 

The Company determines which leaves count for this purpose (along with determining the effect of a leave of absence on vesting of the Award), and when your status as a Service Provider terminates for all purposes under the Plan.

 

 

 

 

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Voting and Other Rights   Subject to the terms of this Agreement, you shall have all the rights and privileges of a stockholder of the Company while the Restricted Stock is held in escrow, including the right to vote and to receive dividends (if any).
     
Adjustments   In the event of a stock split, a stock dividend or a similar change in the Company stock, the number of outstanding Shares covered by this Award may be adjusted (and rounded down to the nearest whole number) pursuant to the Plan.  This Award shall be subject to the terms of the agreement of merger, liquidation or reorganization in the event the Company is subject to such corporate activity.
     

Taxes and Withholding 		 

You will be solely responsible for payment of any and all applicable taxes associated with this Award.

 

The delivery to you of any Shares will not be permitted unless and until you have satisfied any withholding or other taxes that may be due. Tax withholding obligations may arise before release of Shares to you and you must timely satisfy any such obligations as a condition of this Award. At the discretion of the Administrator, any such tax withholding obligations may be settled by the Company withholding and retaining a portion of the Shares from the Shares that would otherwise be deliverable to you and/or by Shares which have already been owned by you for more than six (6) months and which are surrendered to the Company. Such withheld or surrendered Shares will be applied to pay the withholding obligation by using the aggregate fair market value of the withheld or surrendered Shares as of the date of vesting. If Shares are withheld, then you will be delivered the net amount of vested Shares after the Share withholding has been effected and you will not receive the withheld Shares.

     
Restrictions on Issuance and Resale  

The Company will not issue any Shares if the issuance of such Shares at that time would violate any law or regulation.

 

By signing this Agreement, you agree not to sell, transfer, dispose of, pledge, hypothecate, make any short sale of, or otherwise effect a similar transaction of any Shares acquired under this Award (each a “Sale Prohibition”) at a time when applicable laws, regulations or Company or underwriter trading policies prohibit the exercise or disposition of Shares. The Company shall have the right to designate one or more periods of time, each of which generally will not exceed one hundred eighty (180) days in length (provided however, that such period may be extended in connection with the Company’s release (or announcement of release) of earnings results or other material news or events), and to impose a Sale Prohibition, if the Company determines (in its sole discretion) that such limitation(s) is needed in connection with a public offering of Shares or to comply with an underwriter’s request or trading policy, or could in any way facilitate a lessening of any restriction on transfer pursuant to the Securities Act of 1933 or any state securities laws with respect to any issuance of securities by the Company, facilitate the registration or qualification of any securities by the Company under the Securities Act of 1933 or any state securities laws, or facilitate the perfection of any exemption from the registration or qualification requirements of the Securities Act of 1933 or any applicable state securities laws for the issuance or transfer of any securities. The Company may issue stop/transfer instructions and/or appropriately legend any stock certificates issued pursuant to this Award in order to ensure compliance with the foregoing.

 

If the sale of Shares acquired under this Award is not registered under the Securities Act of 1933, but an exemption is available which requires an investment representation or other representation and warranty, you shall represent and agree that the Shares being acquired are being acquired for investment, and not with a view to the sale or distribution thereof, and shall make such other representations and warranties as are deemed necessary or appropriate by the Company and its counsel.

 

 

 

 

 

  4  
 

 

     
Legends  

All certificates representing any Shares issued under this Award may, where applicable, have endorsed thereon the following legends and any other legends the Company determines appropriate:

 

“THE SHARES REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO CERTAIN RESTRICTIONS ON TRANSFER AND OPTIONS TO PURCHASE SUCH SHARES SET FORTH IN AN AGREEMENT BETWEEN THE COMPANY AND THE REGISTERED HOLDER, OR HIS OR HER PREDECESSOR IN INTEREST. A COPY OF SUCH AGREEMENT IS ON FILE AT THE PRINCIPAL OFFICE OF THE COMPANY AND WILL BE FURNISHED UPON WRITTEN REQUEST TO THE SECRETARY OF THE COMPANY BY THE HOLDER OF RECORD OF THE SHARES REPRESENTED BY THIS CERTIFICATE.”

 

“THE SHARES REPRESENTED HEREBY HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, AND MAY NOT BE SOLD, PLEDGED, OR OTHERWISE TRANSFERRED WITHOUT AN EFFECTIVE REGISTRATION THEREOF UNDER SUCH ACT OR AN OPINION OF COUNSEL, SATISFACTORY TO THE COMPANY AND ITS COUNSEL, THAT SUCH REGISTRATION IS NOT REQUIRED.”

     
No Retention Rights  

Your Award or this Agreement does not give you the right to be retained by the Company (or any parent or any subsidiaries or affiliates) in any capacity. The Company (or any parent and any subsidiaries or affiliates) reserves the right to terminate your status as a Service Provider at any time and for any reason.

 

This Award, and the Shares that may be released to you pursuant to this Award are not intended to constitute or replace any pension rights or compensation and are not to be considered compensation of a continuing or recurring nature, or part of your normal or expected compensation, and in no way represent any portion of your salary (if any), compensation or other remuneration for any purpose, including but not limited to, calculating any severance, resignation, termination, redundancy, dismissal, end of service payments, bonuses, long-service awards, pension or retirement benefits or similar payments.

     
Notice  

Any notice to be given or delivered to the Company relating to this Agreement shall be in writing and addressed to the Company at its principal corporate offices. Any notice to be given or delivered to you relating to this Agreement shall be in writing and addressed to you at such address of which you advise the Company in writing. All notices shall be deemed effective upon personal delivery or upon deposit in the U.S. mail, postage prepaid and properly addressed to the party to be notified.

 

The Awardee agrees that the Company may deliver all documents relating to the Plan or this Award (including prospectuses required by the Securities and Exchange Commission), and all other documents that the Company is required to deliver to its security holders or the Awardee (including annual reports, proxy statements and financial statements), either by e-mail or by e-mail notice of a Web site location where those documents have been posted. The Awardee may at any time (i) revoke this consent to e-mail delivery of those documents; (ii) update the e-mail address for delivery of those documents; (iii) obtain at no charge a paper copy of those documents, in each case by writing the Company at 1510 Cotner Ave., Los Angeles, CA 90025, Attention: General Counsel. The Awardee may request an electronic copy of any of those documents by requesting a copy from the General Counsel, 1510 Cotner Ave., Los Angeles, CA 90025. The Awardee understands that an e-mail account and appropriate hardware and software, including a computer or compatible cell phone and an Internet connection, will be required to access documents delivered by e-mail.

     
Applicable Law   This Agreement will be interpreted and enforced under the laws of the State of Delaware without reference to the conflicts of law provisions thereof.

 

 

 

  5  
 

 

     

Voluntary Awardee

  You acknowledge that you are voluntarily participating in the Plan.
     
No Rights to Future Awards   Your rights, if any, in respect of or in connection with this Award or any other Awards are derived solely from the discretionary decision of the Company to permit you to participate in the Plan and to benefit from a discretionary future Award. By accepting this Award, you expressly acknowledge that there is no obligation on the part of the Company to continue the Plan and/or grant any additional Awards to you or benefits in lieu of other Awards even if Awards have been granted repeatedly in the past.  All decisions with respect to future Awards, if any, will be at the sole discretion of the Administrator.
     
Future Value   The future value of the underlying Shares is unknown and cannot be predicted with certainty.  If the underlying Shares do not increase in value (or decrease in value) after the Date of Award, the Award could have little or no value.  
     
No Advice Regarding Award   The Company has not provided any tax, legal or financial advice, nor has the Company made any recommendations regarding your participation in the Plan, or your acquisition or sale of the underlying Shares.  You are hereby advised to consult with your own personal tax, legal and financial advisors regarding your participation in the Plan before taking any action related to the Plan or this Award.
     
No Right to Damages   You will have no right to bring a claim or to receive damages if any portion of the Award is cancelled or expires.  The loss of existing or potential profit in the Award will not constitute an element of damages in the event of your Termination of Service for any reason, even if the termination is in violation of an obligation of the Company or a parent or a subsidiary or an affiliate to you.
     
Data Privacy   You hereby explicitly and unambiguously consent to the collection, use and transfer, in electronic or other form, of your personal data as described in this document by the Company for the exclusive purpose of implementing, administering and managing your participation in the Plan.  You understand that the Company holds certain personal information about you, including, but not limited to, name, home address and telephone number, date of birth, social security or insurance number or other identification number, salary, nationality, job title, any shares of stock or directorships held in the Company, details of all Awards or any other entitlement to Shares awarded, cancelled, purchased, exercised, vested, unvested or outstanding in your favor for the purpose of implementing, managing and administering the Plan (“Data”).  You understand that the Data may be transferred to any third parties assisting in the implementation, administration and management of the Plan, that these recipients may be located in your country or elsewhere and that the recipient country may have different data privacy laws and protections than your country.  You authorize the recipients to receive, possess, use, retain and transfer the Data, in electronic or other form, for the purposes of implementing, administering and managing your participation in the Plan, including any requisite transfer of such Data, as may be required to a broker or other third party with whom you may elect to deposit any Shares acquired under the Plan.

 

By signing the cover sheet of this Agreement, you agree to all of the terms and conditions described above and in the Plan and its prospectus. Any inconsistency between this Agreement and the Plan shall be resolved by reference to the Plan.

 

 

 

  6  
 

 

EXHIBIT A

 

ASSIGNMENT SEPARATE FROM CERTIFICATE

 

FOR VALUE RECEIVED and pursuant to that certain Stock Award Agreement dated as of ________________, 20_____ the undersigned hereby sells, assigns and transfers unto _________ shares of the Common Stock of Radnet, Inc., a Delaware corporation, standing in the undersigned’s name on the books of said corporation represented by certificate No. ____________ , herewith, and does hereby irrevocably constitute and appoint ______________________________ attorney-in-fact to transfer the said stock on the books of the said corporation with full power of substitution in the premises.

 

Dated: __________________, 20____

 

 

_______________________________________

 

 

 

 

 

 

 

 

 

 

 

  7  
 

 

EXHIBIT B

 

ELECTION UNDER SECTION 83(b) OF
THE INTERNAL REVENUE CODE

 

The undersigned taxpayer hereby elects, pursuant to § 83(b) of the Internal Revenue Code of 1986, as amended, to include in gross income as compensation for services the excess (if any) of the fair market value of the shares described below over the amount paid for those shares.

 

1. The name, taxpayer identification number, address of the undersigned, and the taxable year for which this election is being made are:

 

TAXPAYER’S NAME: _____________________________________________

 

TAXPAYER’S SOCIAL SECURITY NUMBER: __________________________

 

ADDRESS: ______________________________________________________

 

TAXABLE YEAR: Calendar Year 20__

 

2. The property which is the subject of this election is __________ shares of common stock of Radnet, Inc.

 

3. The property was transferred to the undersigned on [ DATE ].

 

4. The property is subject to the following restrictions: [ Describe restrictions.]

 

5. The fair market value of the property at the time of transfer (determined without regard to any restriction other than a nonlapse restriction as defined in § 1.83-3(h) of the Income Tax Regulations) is: $_______ per share x ________ shares = $___________.

 

6. For the property transferred, the undersigned paid $______ per share x _________ shares = $______________.

 

7. The amount to include in gross income is $______________. [ The result of the amount reported in Item 5 minus the amount reported in Item 6.]

 

The undersigned taxpayer will file this election with the Internal Revenue Service office with which taxpayer files his or her annual income tax return not later than 30 days after the date of transfer of the property. A copy of the election also will be furnished to the person for whom the services were performed. The undersigned is the person performing the services in connection with which the property was transferred.

 

Dated: _______________________   ___________________________________
                                Taxpayer

 

 

 

 

  8  

 

 

 

EXHIBIT 99.5

 

RADNET, INC.

2006 EQUITY INCENTIVE PLAN

 

STOCK AWARD AGREEMENT

 

The Company hereby awards a Stock Award (the “Restricted Stock”) to the Awardee named below. The terms and conditions of the Stock Award are set forth in this cover sheet and the attached Stock Award Agreement and in the Plan. This cover sheet is incorporated into and a part of the attached Stock Award Agreement (together, the “Agreement”).

 

Date of Award :

 

Name of Awardee (“you”, “your”, “Awardee”):

 

Number of Shares of Restricted Stock Awarded :

 

Amount Paid by Awardee for the Shares of Restricted Stock Awarded :         $ 0.00

 

Fair Market Value of a Share on Date of Award :        $

 

Vesting Calculation Date :

 

Vesting Schedule:

As long as you continuously are a Service Provider, you will become vested as to 100% of the total number of Shares awarded, as shown above on the cover sheet, on the earlier of the close of business on the (i) first anniversary of the Vesting Calculation Date, (ii) Change in Control, or (iii) day before the regular annual meeting of Company stockholders in [NEXT YEAR]. In the event that you cease to be a Service Provider, you will forfeit to the Company without consideration all of the then-unvested Shares subject to this Award. However, the total number of then unvested Shares subject to this Award shall become fully vested if (1) your status as a Service Provider is terminated (x) by the Company due to your Disability or (y) due to your death or (2) you are not re-nominated as a director on the Board for any reason other than (i) failure to adequately perform your duties as a director or (ii) your refusal to stand for re-election for any reason, (3) you are not re-elected by the stockholders to continue to serve on the Board in a contested director election or (4) you are removed by the stockholders without Cause (as defined below) in accordance with the Company’s bylaws and certificate of incorporation.

 

By signing this cover sheet, you agree to all terms and conditions described in the attached Stock Award Agreement and in the Plan and Plan prospectus. You specifically acknowledge that you have carefully read the section entitled "Code Section 83(b) Election" and the Exhibit B attachment and you further acknowledge that you are solely responsible for filing any Code Section 83(b) election, and that such election must be filed within thirty (30) days after the Date of Award in order to be effective. You are also acknowledging receipt of this Agreement and copies of the Plan and its prospectus.

 

Company:   Awardee:
       
By:      
Its:      

 

 

 

 

 

 

 

  1  
 

 

Attachments

RADNET, INC.

2006 EQUITY INCENTIVE PLAN

 

STOCK AWARD AGREEMENT

 

The Plan and Other Agreements  

The text of the Plan is incorporated in this Agreement by this reference. You and the Company agree to execute such further instruments and to take such further action as may reasonably be necessary to carry out the intent of this Agreement. Unless otherwise defined in this Agreement, certain capitalized terms used in this Agreement are defined in the Plan.

 

This Agreement, the attached Exhibits and the Plan constitute the entire understanding between you and the Company regarding this Award of Restricted Stock. Any prior agreements, commitments or negotiations are superseded .

     
Award of Restricted Stock   The Company awards you the number of Shares of Restricted Stock shown on the cover sheet of this Agreement.  The Award is subject to the terms and conditions of this Agreement and the Plan.  This Award is not intended to constitute a nonqualified deferred compensation plan within the meaning of section 409A of the Code and will be interpreted accordingly .
     
Vesting  

This Award will vest according to the Vesting Schedule on the attached cover sheet and also the below paragraph of this section.

 

The term "Cause" shall mean (1) the Awardee's theft, dishonesty, or falsification of any documents or records of the Company or any affiliate; (2) the Awardee's improper use or disclosure of confidential or proprietary information of the Company or any affiliate; (3) any action by the Awardee which has a detrimental effect on the reputation or business of the Company or any affiliate; (4) the Awardee's conviction (including any plea of guilty or nolo contendere) of any criminal act which impairs the Awardee's ability to perform his or her duties with the Company or an affiliate; or (5) the Awardee's violation of a material Company policy.

     
Escrow   The certificate(s) for the Restricted Stock shall be deposited in escrow with the Secretary of the Company (or his/her designee) to be held in accordance with the provisions of this paragraph.  Each deposited certificate shall be accompanied by a duly executed Assignment Separate from Certificate in the form attached hereto as Exhibit A.  The deposited certificates shall remain in escrow until such time as the certificates are to be released or otherwise surrendered for cancellation as discussed below. Upon delivery of the certificates to the Company, you shall be issued an instrument of deposit acknowledging the number of Shares of Restricted Stock delivered in escrow to the Secretary of the Company.
     
   

All regular cash or stock dividends, if any, on the Restricted Stock shall be held in escrow and shall be subject to the same vesting conditions provided in this Agreement.

 

The Restricted Stock held in escrow hereunder shall be subject to the following terms and conditions relating to their release from escrow or their surrender to the Company, provided, however, that the minimum number of Shares released to you in any individual release of Share certificates must be at least twenty-five (25) Shares (unless the release represents your final release of Share certificates from escrow):

 

    · When your interest in the Restricted Stock vests, the certificates for such vested Restricted Stock (and related dividends) shall be released from escrow and delivered to you. Upon your Termination of Service for any reason prior to vesting and in which no vesting is provided upon such termination, any unvested Restricted Stock (and dividends) subject to this Agreement shall be immediately surrendered to the Company.

 

 

  2  
 

 

No Assignment   The Shares subject to this Award shall not be sold, anticipated, assigned, attached, garnished, optioned, transferred or made subject to any creditor’s process, whether voluntarily, involuntarily or by operation of law.  However, this shall not preclude a transfer of vested Shares by will or by the laws of descent and distribution. In addition, pursuant to Company procedures, you may designate a beneficiary who will receive any outstanding vested Shares in the event of your death. Regardless of any marital property settlement agreement, the Company is not obligated to recognize your spouse’s interest in your Award in any way.
     
Code Section 83(b) Election   You represent and warrant that you understand the Federal, state and local income tax consequences of the granting of this Restricted Stock.  Under Section 83 of the Code, the Fair Market Value of the Restricted Stock on the date any forfeiture restrictions applicable to such Restricted Stock lapse will be reportable as ordinary income at that time. For this purpose, “forfeiture restrictions” include surrender to the Company of unvested Restricted Stock as described above. You may voluntarily elect to be taxed at the time the Restricted Stock is acquired to the extent that the Fair Market Value of the Restricted Stock exceeds the amount of consideration paid by you (if any) for such Restricted Stock at that time rather than when such Restricted Stock ceases to be subject to such forfeiture restrictions, by filing an election under Section 83(b) of the Code with the Internal Revenue Service within thirty (30) days after the Date of Award.  A form for making this election is attached as Exhibit B hereto.  Failure to make this filing within the thirty (30) day period will result in the recognition of ordinary income by you as the forfeiture restrictions lapse.  YOU ACKNOWLEDGE THAT IT IS YOUR SOLE RESPONSIBILITY, AND NOT THE COMPANY’S, TO FILE A TIMELY ELECTION UNDER CODE SECTION 83(b), EVEN IF YOU REQUEST THE COMPANY OR ITS REPRESENTATIVES TO MAKE THIS FILING ON YOUR BEHALF.  MOREOVER, YOU ARE RELYING SOLELY ON YOUR OWN ADVISORS WITH RESPECT TO THE DECISION AS TO WHETHER OR NOT TO FILE A CODE SECTION 83(b) ELECTION.
     
Leaves of Absence  

For purposes of this Agreement, your status as a Service Provider does not terminate when you go on a bona fide leave of absence that was approved by the Company (or its parent, subsidiary or affiliate) in writing, if the terms of the leave provide for continued service crediting, or when continued service crediting is required by applicable law. Your status as a Service Provider terminates in any event when the approved leave ends, unless you immediately return to active service.

 

The Company determines which leaves count for this purpose (along with determining the effect of a leave of absence on vesting of the Award), and when your status as a Service Provider terminates for all purposes under the Plan.

     
Voting and Other Rights   Subject to the terms of this Agreement, you shall have all the rights and privileges of a stockholder of the Company while the Restricted Stock is held in escrow, including the right to vote and to receive dividends (if any).  
     
Adjustments   In the event of a stock split, a stock dividend or a similar change in the Company stock, the number of outstanding Shares covered by this Award may be adjusted (and rounded down to the nearest whole number) pursuant to the Plan. This Award shall be subject to the terms of the agreement of merger, liquidation or reorganization in the event the Company is subject to such corporate activity.
     
Taxes and Withholding  

You will be solely responsible for payment of any and all applicable taxes associated with this Award.

 

The delivery to you of any Shares will not be permitted unless and until you have satisfied any withholding or other taxes that may be due. Tax withholding obligations may arise before release of Shares to you and you must timely satisfy any such obligations as a condition of this Award. At the discretion of the Administrator, any such tax withholding obligations may be settled by the Company withholding and retaining a portion of the Shares from the Shares that would otherwise be deliverable to you and/or by Shares which have already been owned by you for more than six (6) months and which are surrendered to the Company. Such withheld or surrendered Shares will be applied to pay the withholding obligation by using the aggregate fair market value of the withheld or surrendered Shares as of the date of vesting. If Shares are withheld, then you will be delivered the net amount of vested Shares after the Share withholding has been effected and you will not receive the withheld Shares.

 

 

 

  3  
 

 

     
Restrictions on Issuance and Resale  

The Company will not issue any Shares if the issuance of such Shares at that time would violate any law or regulation.

 

By signing this Agreement, you agree not to sell, transfer, dispose of, pledge, hypothecate, make any short sale of, or otherwise effect a similar transaction of any Shares acquired under this Award (each a “Sale Prohibition”) at a time when applicable laws, regulations or Company or underwriter trading policies prohibit the exercise or disposition of Shares. The Company shall have the right to designate one or more periods of time, each of which generally will not exceed one hundred eighty (180) days in length (provided however, that such period may be extended in connection with the Company’s release (or announcement of release) of earnings results or other material news or events), and to impose a Sale Prohibition, if the Company determines (in its sole discretion) that such limitation(s) is needed in connection with a public offering of Shares or to comply with an underwriter’s request or trading policy, or could in any way facilitate a lessening of any restriction on transfer pursuant to the Securities Act of 1933 or any state securities laws with respect to any issuance of securities by the Company, facilitate the registration or qualification of any securities by the Company under the Securities Act of 1933 or any state securities laws, or facilitate the perfection of any exemption from the registration or qualification requirements of the Securities Act of 1933 or any applicable state securities laws for the issuance or transfer of any securities. The Company may issue stop/transfer instructions and/or appropriately legend any stock certificates issued pursuant to this Award in order to ensure compliance with the foregoing.

 

If the sale of Shares acquired under this Award is not registered under the Securities Act of 1933, but an exemption is available which requires an investment representation or other representation and warranty, you shall represent and agree that the Shares being acquired are being acquired for investment, and not with a view to the sale or distribution thereof, and shall make such other representations and warranties as are deemed necessary or appropriate by the Company and its counsel.

     
Legends  

All certificates representing any Shares issued under this Award may, where applicable, have endorsed thereon the following legends and any other legends the Company determines appropriate:

 

“THE SHARES REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO CERTAIN RESTRICTIONS ON TRANSFER AND OPTIONS TO PURCHASE SUCH SHARES SET FORTH IN AN AGREEMENT BETWEEN THE COMPANY AND THE REGISTERED HOLDER, OR HIS OR HER PREDECESSOR IN INTEREST. A COPY OF SUCH AGREEMENT IS ON FILE AT THE PRINCIPAL OFFICE OF THE COMPANY AND WILL BE FURNISHED UPON WRITTEN REQUEST TO THE SECRETARY OF THE COMPANY BY THE HOLDER OF RECORD OF THE SHARES REPRESENTED BY THIS CERTIFICATE.”

 

“THE SHARES REPRESENTED HEREBY HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, AND MAY NOT BE SOLD, PLEDGED, OR OTHERWISE TRANSFERRED WITHOUT AN EFFECTIVE REGISTRATION THEREOF UNDER SUCH ACT OR AN OPINION OF COUNSEL, SATISFACTORY TO THE COMPANY AND ITS COUNSEL, THAT SUCH REGISTRATION IS NOT REQUIRED.”

     
No Retention Rights  

Your Award or this Agreement does not give you the right to be retained by the Company (or any parent or any subsidiaries or affiliates) in any capacity. The Company (or any parent and any subsidiaries or affiliates) reserves the right to terminate your status as a Service Provider at any time and for any reason.

 

This Award, and the Shares that may be released to you pursuant to this Award are not intended to constitute or replace any pension rights or compensation and are not to be considered compensation of a continuing or recurring nature, or part of your normal or expected compensation, and in no way represent any portion of your salary (if any), compensation or other remuneration for any purpose, including but not limited to, calculating any severance, resignation, termination, redundancy, dismissal, end of service payments, bonuses, long-service awards, pension or retirement benefits or similar payments.

 

 

 

  4  
 

 

     
Notice  

Any notice to be given or delivered to the Company relating to this Agreement shall be in writing and addressed to the Company at its principal corporate offices. Any notice to be given or delivered to you relating to this Agreement shall be in writing and addressed to you at such address of which you advise the Company in writing. All notices shall be deemed effective upon personal delivery or upon deposit in the U.S. mail, postage prepaid and properly addressed to the party to be notified.

 

The Awardee agrees that the Company may deliver all documents relating to the Plan or this Award (including prospectuses required by the Securities and Exchange Commission), and all other documents that the Company is required to deliver to its security holders or the Awardee (including annual reports, proxy statements and financial statements), either by e-mail or by e-mail notice of a Web site location where those documents have been posted. The Awardee may at any time (i) revoke this consent to e-mail delivery of those documents; (ii) update the e-mail address for delivery of those documents; (iii) obtain at no charge a paper copy of those documents, in each case by writing the Company at 1510 Cotner Ave., Los Angeles, CA 90025, Attention: General Counsel. The Awardee may request an electronic copy of any of those documents by requesting a copy from the General Counsel, 1510 Cotner Ave., Los Angeles, CA 90025. The Awardee understands that an e-mail account and appropriate hardware and software, including a computer or compatible cell phone and an Internet connection, will be required to access documents delivered by e-mail.

     
Applicable Law   This Agreement will be interpreted and enforced under the laws of the State of Delaware without reference to the conflicts of law provisions thereof.
     

Voluntary Awardee

  You acknowledge that you are voluntarily participating in the Plan.
     
No Rights to Future Awards   Your rights, if any, in respect of or in connection with this Award or any other Awards are derived solely from the discretionary decision of the Company to permit you to participate in the Plan and to benefit from a discretionary future Award. By accepting this Award, you expressly acknowledge that there is no obligation on the part of the Company to continue the Plan and/or grant any additional Awards to you or benefits in lieu of other Awards even if Awards have been granted repeatedly in the past. All decisions with respect to future Awards, if any, will be at the sole discretion of the Administrator.
     
Future Value   The future value of the underlying Shares is unknown and cannot be predicted with certainty.  If the underlying Shares do not increase in value (or decrease in value) after the Date of Award, the Award could have little or no value.  
     
No Advice Regarding Award   The Company has not provided any tax, legal or financial advice, nor has the Company made any recommendations regarding your participation in the Plan, or your acquisition or sale of the underlying Shares.  You are hereby advised to consult with your own personal tax, legal and financial advisors regarding your participation in the Plan before taking any action related to the Plan or this Award.
     
No Right to Damages   You will have no right to bring a claim or to receive damages if any portion of the Award is cancelled or expires.  The loss of existing or potential profit in the Award will not constitute an element of damages in the event of your Termination of Service for any reason, even if the termination is in violation of an obligation of the Company or a parent or a subsidiary or an affiliate to you.

 

 

 

  5  
 

 

     
Data Privacy   You hereby explicitly and unambiguously consent to the collection, use and transfer, in electronic or other form, of your personal data as described in this document by the Company for the exclusive purpose of implementing, administering and managing your participation in the Plan.  You understand that the Company holds certain personal information about you, including, but not limited to, name, home address and telephone number, date of birth, social security or insurance number or other identification number, salary, nationality, job title, any shares of stock or directorships held in the Company, details of all Awards or any other entitlement to Shares awarded, cancelled, purchased, exercised, vested, unvested or outstanding in your favor for the purpose of implementing, managing and administering the Plan (“Data”).  You understand that the Data may be transferred to any third parties assisting in the implementation, administration and management of the Plan, that these recipients may be located in your country or elsewhere and that the recipient country may have different data privacy laws and protections than your country.  You authorize the recipients to receive, possess, use, retain and transfer the Data, in electronic or other form, for the purposes of implementing, administering and managing your participation in the Plan, including any requisite transfer of such Data, as may be required to a broker or other third party with whom you may elect to deposit any Shares acquired under the Plan.  

 

By signing the cover sheet of this Agreement, you agree to all of the terms and conditions described above and in the Plan and its prospectus. Any inconsistency between this Agreement and the Plan shall be resolved by reference to the Plan.

 

 

 

 

 

  6  
 

 

EXHIBIT A

 

ASSIGNMENT SEPARATE FROM CERTIFICATE

 

FOR VALUE RECEIVED and pursuant to that certain Stock Award Agreement dated as of ________________, 20_____ the undersigned hereby sells, assigns and transfers unto _________ shares of the Common Stock of Radnet, Inc., a Delaware corporation, standing in the undersigned’s name on the books of said corporation represented by certificate No. ____________ , herewith, and does hereby irrevocably constitute and appoint ______________________________ attorney-in-fact to transfer the said stock on the books of the said corporation with full power of substitution in the premises.

 

Dated: __________________, 20____

 

 

_______________________________________

 

 

 

 

 

 

 

 

 

 

 

 

  7  
 

 

EXHIBIT B

 

ELECTION UNDER SECTION 83(b) OF
THE INTERNAL REVENUE CODE

 

The undersigned taxpayer hereby elects, pursuant to § 83(b) of the Internal Revenue Code of 1986, as amended, to include in gross income as compensation for services the excess (if any) of the fair market value of the shares described below over the amount paid for those shares.

 

1. The name, taxpayer identification number, address of the undersigned, and the taxable year for which this election is being made are:

 

TAXPAYER’S NAME: _____________________________________________

 

TAXPAYER’S SOCIAL SECURITY NUMBER: __________________________

 

ADDRESS: ______________________________________________________

 

TAXABLE YEAR: Calendar Year 20__

 

2. The property which is the subject of this election is __________ shares of common stock of RadNet, Inc.

 

3. The property was transferred to the undersigned on [ DATE ].

 

4. The property is subject to the following restrictions: [ Describe restrictions.]

 

5. The fair market value of the property at the time of transfer (determined without regard to any restriction other than a nonlapse restriction as defined in § 1.83-3(h) of the Income Tax Regulations) is: $_______ per share x ________ shares = $___________.

 

6. For the property transferred, the undersigned paid $______ per share x _________ shares = $______________.

 

7. The amount to include in gross income is $______________. [ The result of the amount reported in Item 5 minus the amount reported in Item 6.]

 

The undersigned taxpayer will file this election with the Internal Revenue Service office with which taxpayer files his or her annual income tax return not later than 30 days after the date of transfer of the property. A copy of the election also will be furnished to the person for whom the services were performed. The undersigned is the person performing the services in connection with which the property was transferred.

 

Dated: _______________________   ___________________________________
                                Taxpayer

 

 

  8  

EXHIBIT 99.6

 

RADNET, INC.

2006 EQUITY INCENTIVE PLAN

 

STOCK AWARD AGREEMENT

 

The Company hereby awards a Stock Award (the “Stock Units”) to the Awardee named below. The terms and conditions of the Stock Award are set forth in this cover sheet and the attached Stock Award Agreement and in the Plan. This cover sheet is incorporated into and a part of the attached Stock Award Agreement (together, the “Agreement”).

 

Date of Award:  
   
Name of Awardee (“you”, “your”, “Awardee”):  
   
Number of Stock Units Awarded:  
   
Amount Paid by Awardee for the Stock Units Awarded: $0.00
   
Fair Market Value of a Share on Date of Award: $
   
Vesting Calculation Date:  
   
Vesting Schedule:  

 

As long as you continuously are a Service Provider, you will become incrementally vested as to one-third of the total number of Stock Units awarded (rounded to the nearest whole number), as shown above, on each of the Vesting Calculation Date and on each of the first two anniversaries of the Vesting Calculation Date. In the event that you cease to be a Service Provider, you will forfeit to the Company without consideration all of the then-unvested Stock Units subject to this Award. However, the total number of then unvested Stock Units subject to this Award shall become fully vested if either (i) there is a Change in Control and your status as a Service Provider is either terminated without Cause (as defined below) by the Company or is terminated by you for Good Reason (as defined below), in either case in anticipation of or within 24 months after the Change in Control or (ii) your status as a Service Provider is terminated (x) by the Company due to your Disability or (y) due to your death.

 

By signing this cover sheet, you agree to all terms and conditions described in the attached Stock Award Agreement and in the Plan and Plan prospectus and in the NDC Plan (as defined below). You are also acknowledging receipt of this Agreement and copies of the NDC Plan, and the Plan and its prospectus.

 

 

Company:   Awardee:
       
By:      
Its:      

 

 

 

 

  1  
 

 

Attachments

 

RADNET, INC.

2006 EQUITY INCENTIVE PLAN

 

STOCK AWARD AGREEMENT

 

The Plan and Other Agreements

The text of the Plan and the NDC Plan (as defined below) are incorporated in this Agreement by this reference. You and the Company agree to execute such further instruments and to take such further action as may reasonably be necessary to carry out the intent of this Agreement. Unless otherwise defined in this Agreement, certain capitalized terms used in this Agreement are defined in the Plan.

 

This Agreement, the Plan and the NDC Plan constitute the entire understanding between you and the Company regarding this Award of Stock Units. Any prior agreements, commitments or negotiations are superseded.

   
Award of Stock Units

The Company awards you the number of Stock Units shown on the cover sheet of this Agreement. The Award is subject to the terms and conditions of this Agreement, the Plan and the NDC Plan.

 

This Award is intended to constitute nonqualified deferred compensation within the meaning of section 409A of the Code and will be interpreted to comply with Code Section 409A.

   
Vesting

This Award will vest according to the Vesting Schedule on the attached cover sheet and also the below paragraph of this section.

 

The term "Cause" shall mean (1) the Awardee's theft, dishonesty, or falsification of any documents or records of the Company or any affiliate; (2) the Awardee's improper use or disclosure of confidential or proprietary information of the Company or any affiliate; (3) any action by the Awardee which has a detrimental effect on the reputation or business of the Company or any affiliate; (4) the Awardee's failure or inability to perform any reasonable assigned duties after written notice from the Company or an affiliate, and a reasonable opportunity to cure, such failure or inability; (5) any material breach by the Awardee of any employment or service agreement between the Awardee and the Company or an affiliate, which breach is not cured pursuant to the terms of such agreement; (6) the Awardee's conviction (including any plea of guilty or nolo contendere) of any criminal act which impairs the Awardee's ability to perform his or her duties with the Company or an affiliate; or (7) the Awardee's violation of a material Company policy.

 

The term "Good Reason" shall mean, as determined by the Administrator, (A) a material adverse change in the Awardee's title, stature, authority, or responsibilities with the Company (or the affiliate employing him or her); (B) a material reduction in the Awardee's base salary or annual bonus opportunity; or (C) receipt of notice by Awardee that the Awardee's principal workplace will be relocated by more than 50 miles. The Awardee must provide written notice (the “Good Reason Notice”) to the Company within 60 days of the initial existence of a Good Reason event or else the Awardee will have waived any ability to resign his/her service for Good Reason with respect to such event. The Company shall have 15 days after its receipt of the Good Reason Notice to cure or remedy the Good Reason event as determined by the Administrator such that Good Reason will no longer exist. If the Company fails to timely cure or remedy the Good Reason event then the Awardee must affirmatively resign his/her status as a Service Provider within 15 business days after the expiration of the foregoing 15 day cure/remedy period or else the Awardee will have waived any ability to resign his/her service for Good Reason with respect to such event.

 

 

 

 

  2  
 

 

   
Settlement

The time of settlement for Stock Units that vest under this Award has been deferred in accordance with your voluntary Deferral Election that you provided the Company under the Company’s Nonqualified Deferred Compensation Plan (the “NDC Plan”). To the extent a Stock Unit becomes vested and subject to your satisfaction of any tax withholding obligations as discussed below, each vested Stock Unit will entitle you to receive either one Share or cash equivalent (as determined by the Administrator) which will be distributed to you (as provided on your NDC Deferral Election form and in accordance with the NDC Plan) on the earliest of (i) your Separation From Service, (ii) a Change in Control, (iii) your death or Disability, or (iv) [DATE]. Issuance of such Shares and/or cash shall be in complete satisfaction of such vested Stock Units. Such settled Stock Units shall be immediately cancelled and no longer outstanding and you shall have no further rights or entitlements related to those settled Stock Units.

   
No Assignment The Stock Units subject to this Award shall not be sold, anticipated, assigned, attached, garnished, optioned, transferred or made subject to any creditor’s process, whether voluntarily, involuntarily or by operation of law. However, this shall not preclude a transfer of vested Shares that are issued in settlement of Stock Units) by will or by the laws of descent and distribution. In addition, pursuant to Company procedures, you may designate a beneficiary who will receive any outstanding vested Shares in the event of your death.  Regardless of any marital property settlement agreement, the Company is not obligated to recognize your spouse’s interest in your Award in any way.
   
Leaves of Absence

For purposes of this Agreement, your status as a Service Provider does not terminate when you go on a bona fide leave of absence that was approved by the Company (or its parent, subsidiary or affiliate) in writing, if the terms of the leave provide for continued service crediting, or when continued service crediting is required by applicable law. Your status as a Service Provider terminates in any event when the approved leave ends, unless you immediately return to active service.

 

The Company determines which leaves count for this purpose (along with determining the effect of a leave of absence on vesting of the Award), and when your status as a Service Provider terminates for all purposes under the Plan.

   
Voting and Other Rights

As a holder of Stock Units, you shall have no rights other than those of a general creditor of the Company. Subject to the terms of this Agreement, a holder of outstanding Stock Units has none of the rights and privileges of a stockholder of the Company. Without limiting the generality of the foregoing, a holder of outstanding Stock Units has no right to vote or to receive dividends (if any) on the Shares represented by such Stock Units. Subject to the terms and conditions of this Agreement, Stock Units create no fiduciary duty of the Company to you and only represent an unfunded and unsecured contractual obligation of the Company. The Stock Units shall not be treated as property or as a trust fund of any kind.

 

You, or your estate, shall have no rights as a stockholder of the Company with regard to the Award until you have been issued the applicable Shares by the Company and have satisfied all other conditions specified in the Plan. No adjustment shall be made for cash or stock dividends or other rights for which the record date is prior to the date when such applicable Shares are issued.

   
Adjustments In the event of a stock split, a stock dividend or a similar change in the Company stock, the number of outstanding Stock Units covered by this Award may be adjusted (and rounded down to the nearest whole number) pursuant to the Plan.  This Award shall be subject to the terms of the agreement of merger, liquidation or reorganization in the event the Company is subject to such corporate activity.

 

 

 

 

  3  
 

 

   
Taxes and Withholding

You will be solely responsible for payment of any and all applicable taxes associated with this Award.

 

The delivery to you of any Shares (or payment of cash) will not be permitted unless and until you have satisfied any withholding or other taxes that may be due. Tax withholding obligations may arise before settlement of Stock Units and you must timely satisfy any such obligations as a condition of this Award. At the discretion of the Administrator, any such tax withholding obligations may be settled by the Company withholding and retaining a portion of the Shares from the Shares that would otherwise be deliverable to you as of the settlement date and/or by Shares which have already been owned by you for more than six (6) months and which are surrendered to the Company. Such withheld or surrendered Shares will be applied to pay the withholding obligation by using the aggregate fair market value of the withheld or surrendered Shares as of the date of settlement. If Shares are withheld, then you will be delivered the net amount of vested Shares after the Share withholding has been effected and you will not receive the withheld Shares.

   
Restrictions on Issuance and Resale

The Company will not issue any Shares if the issuance of such Shares at that time would violate any law or regulation.

By signing this Agreement, you agree not to sell, transfer, dispose of, pledge, hypothecate, make any short sale of, or otherwise effect a similar transaction of any Shares acquired under this Award (each a “Sale Prohibition”) at a time when applicable laws, regulations or Company or underwriter trading policies prohibit the exercise or disposition of Shares. The Company shall have the right to designate one or more periods of time, each of which generally will not exceed one hundred eighty (180) days in length (provided however, that such period may be extended in connection with the Company’s release (or announcement of release) of earnings results or other material news or events), and to impose a Sale Prohibition, if the Company determines (in its sole discretion) that such limitation(s) is needed in connection with a public offering of Shares or to comply with an underwriter’s request or trading policy, or could in any way facilitate a lessening of any restriction on transfer pursuant to the Securities Act of 1933 or any state securities laws with respect to any issuance of securities by the Company, facilitate the registration or qualification of any securities by the Company under the Securities Act of 1933 or any state securities laws, or facilitate the perfection of any exemption from the registration or qualification requirements of the Securities Act of 1933 or any applicable state securities laws for the issuance or transfer of any securities. The Company may issue stop/transfer instructions and/or appropriately legend any stock certificates issued pursuant to this Award in order to ensure compliance with the foregoing.

 

If the sale of Shares acquired under this Award is not registered under the Securities Act of 1933, but an exemption is available which requires an investment representation or other representation and warranty, you shall represent and agree that the Shares being acquired are being acquired for investment, and not with a view to the sale or distribution thereof, and shall make such other representations and warranties as are deemed necessary or appropriate by the Company and its counsel.

   
Legends

All certificates representing any Shares issued under this Award may, where applicable, have endorsed thereon the following legends and any other legends the Company determines appropriate:

 

“THE SHARES REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO CERTAIN RESTRICTIONS ON TRANSFER AND OPTIONS TO PURCHASE SUCH SHARES SET FORTH IN AN AGREEMENT BETWEEN THE COMPANY AND THE REGISTERED HOLDER, OR HIS OR HER PREDECESSOR IN INTEREST. A COPY OF SUCH AGREEMENT IS ON FILE AT THE PRINCIPAL OFFICE OF THE COMPANY AND WILL BE FURNISHED UPON WRITTEN REQUEST TO THE SECRETARY OF THE COMPANY BY THE HOLDER OF RECORD OF THE SHARES REPRESENTED BY THIS CERTIFICATE.”

 

“THE SHARES REPRESENTED HEREBY HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, AND MAY NOT BE SOLD, PLEDGED, OR OTHERWISE TRANSFERRED WITHOUT AN EFFECTIVE REGISTRATION THEREOF UNDER SUCH ACT OR AN OPINION OF COUNSEL, SATISFACTORY TO THE COMPANY AND ITS COUNSEL, THAT SUCH REGISTRATION IS NOT REQUIRED.”

 

 

 

 

  4  
 

 

   
No Retention Rights

Your Award or this Agreement does not give you the right to be retained by the Company (or any parent or any subsidiaries or affiliates) in any capacity. The Company (or any parent and any subsidiaries or affiliates) reserves the right to terminate your status as a Service Provider at any time and for any reason.

 

This Award, the Stock Units, and the Shares (or cash) that may be released to you pursuant to this Award are not intended to constitute or replace any pension rights or compensation and are not to be considered compensation of a continuing or recurring nature, or part of your normal or expected compensation, and in no way represent any portion of your salary (if any), compensation or other remuneration for any purpose, including but not limited to, calculating any severance, resignation, termination, redundancy, dismissal, end of service payments, bonuses, long-service awards, pension or retirement benefits or similar payments.

   
Notice

Any notice to be given or delivered to the Company relating to this Agreement shall be in writing and addressed to the Company at its principal corporate offices. Any notice to be given or delivered to you relating to this Agreement shall be in writing and addressed to you at such address of which you advise the Company in writing. All notices shall be deemed effective upon personal delivery or upon deposit in the U.S. mail, postage prepaid and properly addressed to the party to be notified.

 

The Awardee agrees that the Company may deliver all documents relating to the Plan or this Award (including prospectuses required by the Securities and Exchange Commission), and all other documents that the Company is required to deliver to its security holders or the Awardee (including annual reports, proxy statements and financial statements), either by e-mail or by e-mail notice of a Web site location where those documents have been posted. The Awardee may at any time (i) revoke this consent to e-mail delivery of those documents; (ii) update the e-mail address for delivery of those documents; (iii) obtain at no charge a paper copy of those documents, in each case by writing the Company at 1510 Cotner Ave., Los Angeles, CA 90025, Attention: General Counsel. The Awardee may request an electronic copy of any of those documents by requesting a copy from the General Counsel, 1510 Cotner Ave., Los Angeles, CA 90025. The Awardee understands that an e-mail account and appropriate hardware and software, including a computer or compatible cell phone and an Internet connection, will be required to access documents delivered by e-mail.

   
Applicable Law This Agreement will be interpreted and enforced under the laws of the State of Delaware without reference to the conflicts of law provisions thereof.
   
Voluntary Awardee

You acknowledge that you are voluntarily participating in the Plan.

   
No Rights to Future Awards Your rights, if any, in respect of or in connection with this Award or any other Awards are derived solely from the discretionary decision of the Company to permit you to participate in the Plan and to benefit from a discretionary future Award.  By accepting this Award, you expressly acknowledge that there is no obligation on the part of the Company to continue the Plan (or the NDC Plan) and/or grant any additional Awards to you or benefits in lieu of other Awards even if Awards have been granted repeatedly in the past.  All decisions with respect to future Awards, if any, will be at the sole discretion of the Administrator.
   
Future Value The future value of the underlying Shares is unknown and cannot be predicted with certainty. If the underlying Shares do not increase in value (or decrease in value) after the Date of Award, the Award could have little or no value.  
   
No Advice Regarding Award The Company has not provided any tax, legal or financial advice, nor has the Company made any recommendations regarding your participation in the Plan, or NDC Plan, or your acquisition or sale of the underlying Shares. You are hereby advised to consult with your own personal tax, legal and financial advisors regarding your participation in the Plan and NDC Plan before taking any action related to the Plan, NDC Plan, or this Award.

 

 

 

 

  5  
 

 

   
No Right to Damages You will have no right to bring a claim or to receive damages if any portion of the Award is cancelled or expires.  The loss of existing or potential profit in the Award will not constitute an element of damages in the event of your Termination of Service for any reason, even if the termination is in violation of an obligation of the Company or a parent or a subsidiary or an affiliate to you.
   
Data Privacy You hereby explicitly and unambiguously consent to the collection, use and transfer, in electronic or other form, of your personal data as described in this document by the Company for the exclusive purpose of implementing, administering and managing your participation in the Plan.  You understand that the Company holds certain personal information about you, including, but not limited to, name, home address and telephone number, date of birth, social security or insurance number or other identification number, salary, nationality, job title, any shares of stock or directorships held in the Company, details of all Awards or any other entitlement to Shares awarded, cancelled, purchased, exercised, vested, unvested or outstanding in your favor for the purpose of implementing, managing and administering the Plan (“Data”).  You understand that the Data may be transferred to any third parties assisting in the implementation, administration and management of the Plan, that these recipients may be located in your country or elsewhere and that the recipient country may have different data privacy laws and protections than your country.  You authorize the recipients to receive, possess, use, retain and transfer the Data, in electronic or other form, for the purposes of implementing, administering and managing your participation in the Plan, including any requisite transfer of such Data, as may be required to a broker or other third party with whom you may elect to deposit any Shares acquired under the Plan.  

 

By signing the cover sheet of this Agreement, you agree to all of the terms and conditions described above and in the NDC Plan, and in the Plan and its prospectus. Any inconsistency between this Agreement, NDC Plan and the Plan shall be resolved by reference to the Plan except that any conflicts regarding the time of settlement of Stock Units shall be resolved by reference to the NDC Plan and applicable Deferral Election.

 

 

 

 

  6  

EXHIBIT 99.7

 

RADNET, INC.

2006 EQUITY INCENTIVE PLAN

 

STOCK AWARD AGREEMENT

 

The Company hereby awards a Stock Award (the “Stock Units”) to the Awardee named below. The terms and conditions of the Stock Award are set forth in this cover sheet and the attached Stock Award Agreement and in the Plan. This cover sheet is incorporated into and a part of the attached Stock Award Agreement (together, the “Agreement”).

 

Date of Award:  
   
Name of Awardee (“you”, “your”, “Awardee”):  
   
Number of Stock Units Awarded:  
   
Amount Paid by Awardee for the Stock Units Awarded: $0.00
   
Fair Market Value of a Share on Date of Award: $
   
Vesting Calculation Date:  
   
Vesting Schedule:  

 

As long as you continuously are a Service Provider, you will become vested as to 100% of the total number of Stock Units awarded, as shown above on the cover sheet, on the earlier of the close of business on the (i) first anniversary of the Vesting Calculation Date, (ii) Change in Control, or (iii) day before the regular annual meeting of Company stockholders in [NEXT YEAR]. In the event that you cease to be a Service Provider, you will forfeit to the Company without consideration all of the then-unvested Stock Units subject to this Award. However, the total number of then unvested Stock Units subject to this Award shall become fully vested if (1) your status as a Service Provider is terminated (x) by the Company due to your Disability or (y) due to your death or (2) you are not re-nominated as a director on the Board for any reason other than (i) failure to adequately perform your duties as a director or (ii) your refusal to stand for re-election for any reason, (3) you are not re-elected by the stockholders to continue to serve on the Board in a contested director election or (4) you are removed by the stockholders without Cause (as defined below) in accordance with the Company’s bylaws and certificate of incorporation.

 

By signing this cover sheet, you agree to all terms and conditions described in the attached Stock Award Agreement and in the Plan and Plan prospectus and in the NDC Plan (as defined below). You are also acknowledging receipt of this Agreement and copies of the NDC Plan, and the Plan and its prospectus.

 

 

Company:   Awardee:
       
By:      
Its:      

 

 

 

 

 

  1  
 

 

Attachments

 

RADNET, INC.

2006 EQUITY INCENTIVE PLAN

 

STOCK AWARD AGREEMENT

 

The Plan and Other Agreements

The text of the Plan and the NDC Plan (as defined below) are incorporated in this Agreement by this reference. You and the Company agree to execute such further instruments and to take such further action as may reasonably be necessary to carry out the intent of this Agreement. Unless otherwise defined in this Agreement, certain capitalized terms used in this Agreement are defined in the Plan.

 

This Agreement, the Plan and the NDC Plan constitute the entire understanding between you and the Company regarding this Award of Stock Units. Any prior agreements, commitments or negotiations are superseded.

   
Award of Stock Units

The Company awards you the number of Stock Units shown on the cover sheet of this Agreement. The Award is subject to the terms and conditions of this Agreement, the Plan and the NDC Plan.

 

This Award is intended to constitute nonqualified deferred compensation within the meaning of section 409A of the Code and will be interpreted to comply with Code Section 409A.

   
Vesting

This Award will vest according to the Vesting Schedule on the attached cover sheet and also the below paragraph of this section.

 

The term "Cause" shall mean (1) the Awardee's theft, dishonesty, or falsification of any documents or records of the Company or any affiliate; (2) the Awardee's improper use or disclosure of confidential or proprietary information of the Company or any affiliate; (3) any action by the Awardee which has a detrimental effect on the reputation or business of the Company or any affiliate; (4) the Awardee's conviction (including any plea of guilty or nolo contendere) of any criminal act which impairs the Awardee's ability to perform his or her duties with the Company or an affiliate; or (5) the Awardee's violation of a material Company policy.

   
Settlement

The time of settlement for Stock Units that vest under this Award has been deferred in accordance with your voluntary Deferral Election that you provided the Company under the Company’s Nonqualified Deferred Compensation Plan (the “NDC Plan”). To the extent a Stock Unit becomes vested and subject to your satisfaction of any tax withholding obligations as discussed below, each vested Stock Unit will entitle you to receive either one Share or cash equivalent (as determined by the Administrator) which will be distributed to you (as provided on your NDC Deferral Election form and in accordance with the NDC Plan) on the earliest of (i) your Separation From Service, (ii) a Change in Control, (iii) your death or Disability, or (iv) [DATE]. Issuance of such Shares and/or cash shall be in complete satisfaction of such vested Stock Units. Such settled Stock Units shall be immediately cancelled and no longer outstanding and you shall have no further rights or entitlements related to those settled Stock Units.

   
No Assignment The Stock Units subject to this Award shall not be sold, anticipated, assigned, attached, garnished, optioned, transferred or made subject to any creditor’s process, whether voluntarily, involuntarily or by operation of law.  However, this shall not preclude a transfer of vested Shares that are issued in settlement of Stock Units) by will or by the laws of descent and distribution.  In addition, pursuant to Company procedures, you may designate a beneficiary who will receive any outstanding vested Shares in the event of your death.  Regardless of any marital property settlement agreement, the Company is not obligated to recognize your spouse’s interest in your Award in any way.

 

 

 

 

 

  2  
 

 

   
Leaves of Absence

For purposes of this Agreement, your status as a Service Provider does not terminate when you go on a bona fide leave of absence that was approved by the Company (or its parent, subsidiary or affiliate) in writing, if the terms of the leave provide for continued service crediting, or when continued service crediting is required by applicable law. Your status as a Service Provider terminates in any event when the approved leave ends, unless you immediately return to active service.

 

The Company determines which leaves count for this purpose (along with determining the effect of a leave of absence on vesting of the Award), and when your status as a Service Provider terminates for all purposes under the Plan.

   
Voting and Other Rights

As a holder of Stock Units, you shall have no rights other than those of a general creditor of the Company. Subject to the terms of this Agreement, a holder of outstanding Stock Units has none of the rights and privileges of a stockholder of the Company. Without limiting the generality of the foregoing, a holder of outstanding Stock Units has no right to vote or to receive dividends (if any) on the Shares represented by such Stock Units. Subject to the terms and conditions of this Agreement, Stock Units create no fiduciary duty of the Company to you and only represent an unfunded and unsecured contractual obligation of the Company. The Stock Units shall not be treated as property or as a trust fund of any kind.

 

You, or your estate, shall have no rights as a stockholder of the Company with regard to the Award until you have been issued the applicable Shares by the Company and have satisfied all other conditions specified in the Plan. No adjustment shall be made for cash or stock dividends or other rights for which the record date is prior to the date when such applicable Shares are issued.

   
Adjustments In the event of a stock split, a stock dividend or a similar change in the Company stock, the number of outstanding Stock Units covered by this Award may be adjusted (and rounded down to the nearest whole number) pursuant to the Plan.  This Award shall be subject to the terms of the agreement of merger, liquidation or reorganization in the event the Company is subject to such corporate activity.

   
Taxes and Withholding

You will be solely responsible for payment of any and all applicable taxes associated with this Award.

 

The delivery to you of any Shares (or payment of cash) will not be permitted unless and until you have satisfied any withholding or other taxes that may be due. Tax withholding obligations may arise before settlement of Stock Units and you must timely satisfy any such obligations as a condition of this Award. At the discretion of the Administrator, any such tax withholding obligations may be settled by the Company withholding and retaining a portion of the Shares from the Shares that would otherwise be deliverable to you as of the settlement date and/or by Shares which have already been owned by you for more than six (6) months and which are surrendered to the Company. Such withheld or surrendered Shares will be applied to pay the withholding obligation by using the aggregate fair market value of the withheld or surrendered Shares as of the date of settlement. If Shares are withheld, then you will be delivered the net amount of vested Shares after the Share withholding has been effected and you will not receive the withheld Shares.

 

 

 

 

 

  3  
 

 

   
Restrictions on Issuance and Resale

The Company will not issue any Shares if the issuance of such Shares at that time would violate any law or regulation.

 

By signing this Agreement, you agree not to sell, transfer, dispose of, pledge, hypothecate, make any short sale of, or otherwise effect a similar transaction of any Shares acquired under this Award (each a “Sale Prohibition”) at a time when applicable laws, regulations or Company or underwriter trading policies prohibit the exercise or disposition of Shares. The Company shall have the right to designate one or more periods of time, each of which generally will not exceed one hundred eighty (180) days in length (provided however, that such period may be extended in connection with the Company’s release (or announcement of release) of earnings results or other material news or events), and to impose a Sale Prohibition, if the Company determines (in its sole discretion) that such limitation(s) is needed in connection with a public offering of Shares or to comply with an underwriter’s request or trading policy, or could in any way facilitate a lessening of any restriction on transfer pursuant to the Securities Act of 1933 or any state securities laws with respect to any issuance of securities by the Company, facilitate the registration or qualification of any securities by the Company under the Securities Act of 1933 or any state securities laws, or facilitate the perfection of any exemption from the registration or qualification requirements of the Securities Act of 1933 or any applicable state securities laws for the issuance or transfer of any securities. The Company may issue stop/transfer instructions and/or appropriately legend any stock certificates issued pursuant to this Award in order to ensure compliance with the foregoing.

 

If the sale of Shares acquired under this Award is not registered under the Securities Act of 1933, but an exemption is available which requires an investment representation or other representation and warranty, you shall represent and agree that the Shares being acquired are being acquired for investment, and not with a view to the sale or distribution thereof, and shall make such other representations and warranties as are deemed necessary or appropriate by the Company and its counsel.

   
Legends

All certificates representing any Shares issued under this Award may, where applicable, have endorsed thereon the following legends and any other legends the Company determines appropriate:

 

“THE SHARES REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO CERTAIN RESTRICTIONS ON TRANSFER AND OPTIONS TO PURCHASE SUCH SHARES SET FORTH IN AN AGREEMENT BETWEEN THE COMPANY AND THE REGISTERED HOLDER, OR HIS OR HER PREDECESSOR IN INTEREST. A COPY OF SUCH AGREEMENT IS ON FILE AT THE PRINCIPAL OFFICE OF THE COMPANY AND WILL BE FURNISHED UPON WRITTEN REQUEST TO THE SECRETARY OF THE COMPANY BY THE HOLDER OF RECORD OF THE SHARES REPRESENTED BY THIS CERTIFICATE.”

 

“THE SHARES REPRESENTED HEREBY HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, AND MAY NOT BE SOLD, PLEDGED, OR OTHERWISE TRANSFERRED WITHOUT AN EFFECTIVE REGISTRATION THEREOF UNDER SUCH ACT OR AN OPINION OF COUNSEL, SATISFACTORY TO THE COMPANY AND ITS COUNSEL, THAT SUCH REGISTRATION IS NOT REQUIRED.”

   
No Retention Rights

Your Award or this Agreement does not give you the right to be retained by the Company (or any parent or any subsidiaries or affiliates) in any capacity. The Company (or any parent and any subsidiaries or affiliates) reserves the right to terminate your status as a Service Provider at any time and for any reason.

 

This Award, the Stock Units, and the Shares (or cash) that may be released to you pursuant to this Award are not intended to constitute or replace any pension rights or compensation and are not to be considered compensation of a continuing or recurring nature, or part of your normal or expected compensation, and in no way represent any portion of your salary (if any), compensation or other remuneration for any purpose, including but not limited to, calculating any severance, resignation, termination, redundancy, dismissal, end of service payments, bonuses, long-service awards, pension or retirement benefits or similar payments.

 

 

 

 

 

 

  4  
 

 

   
Notice

Any notice to be given or delivered to the Company relating to this Agreement shall be in writing and addressed to the Company at its principal corporate offices. Any notice to be given or delivered to you relating to this Agreement shall be in writing and addressed to you at such address of which you advise the Company in writing. All notices shall be deemed effective upon personal delivery or upon deposit in the U.S. mail, postage prepaid and properly addressed to the party to be notified.

 

The Awardee agrees that the Company may deliver all documents relating to the Plan or this Award (including prospectuses required by the Securities and Exchange Commission), and all other documents that the Company is required to deliver to its security holders or the Awardee (including annual reports, proxy statements and financial statements), either by e-mail or by e-mail notice of a Web site location where those documents have been posted. The Awardee may at any time (i) revoke this consent to e-mail delivery of those documents; (ii) update the e-mail address for delivery of those documents; (iii) obtain at no charge a paper copy of those documents, in each case by writing the Company at 1510 Cotner Ave., Los Angeles, CA 90025, Attention: General Counsel. The Awardee may request an electronic copy of any of those documents by requesting a copy from the General Counsel, 1510 Cotner Ave., Los Angeles, CA 90025. The Awardee understands that an e-mail account and appropriate hardware and software, including a computer or compatible cell phone and an Internet connection, will be required to access documents delivered by e-mail.

   
Applicable Law

This Agreement will be interpreted and enforced under the laws of the State of Delaware without reference to the conflicts of law provisions thereof.

   
Voluntary Awardee You acknowledge that you are voluntarily participating in the Plan.
   
No Rights to Future Awards Your rights, if any, in respect of or in connection with this Award or any other Awards are derived solely from the discretionary decision of the Company to permit you to participate in the Plan and to benefit from a discretionary future Award. By accepting this Award, you expressly acknowledge that there is no obligation on the part of the Company to continue the Plan (or the NDC Plan) and/or grant any additional Awards to you or benefits in lieu of other Awards even if Awards have been granted repeatedly in the past.  All decisions with respect to future Awards, if any, will be at the sole discretion of the Administrator.
   
Future Value The future value of the underlying Shares is unknown and cannot be predicted with certainty. If the underlying Shares do not increase in value (or decrease in value) after the Date of Award, the Award could have little or no value.
   
No Advice Regarding Award The Company has not provided any tax, legal or financial advice, nor has the Company made any recommendations regarding your participation in the Plan, or NDC Plan, or your acquisition or sale of the underlying Shares. You are hereby advised to consult with your own personal tax, legal and financial advisors regarding your participation in the Plan and NDC Plan before taking any action related to the Plan, NDC Plan, or this Award.
   
No Right to Damages You will have no right to bring a claim or to receive damages if any portion of the Award is cancelled or expires.  The loss of existing or potential profit in the Award will not constitute an element of damages in the event of your Termination of Service for any reason, even if the termination is in violation of an obligation of the Company or a parent or a subsidiary or an affiliate to you.

 

 

 

 

 

 

  5  
 

 

   
Data Privacy You hereby explicitly and unambiguously consent to the collection, use and transfer, in electronic or other form, of your personal data as described in this document by the Company for the exclusive purpose of implementing, administering and managing your participation in the Plan. You understand that the Company holds certain personal information about you, including, but not limited to, name, home address and telephone number, date of birth, social security or insurance number or other identification number, salary, nationality, job title, any shares of stock or directorships held in the Company, details of all Awards or any other entitlement to Shares awarded, cancelled, purchased, exercised, vested, unvested or outstanding in your favor for the purpose of implementing, managing and administering the Plan (“Data”).  You understand that the Data may be transferred to any third parties assisting in the implementation, administration and management of the Plan, that these recipients may be located in your country or elsewhere and that the recipient country may have different data privacy laws and protections than your country. You authorize the recipients to receive, possess, use, retain and transfer the Data, in electronic or other form, for the purposes of implementing, administering and managing your participation in the Plan, including any requisite transfer of such Data, as may be required to a broker or other third party with whom you may elect to deposit any Shares acquired under the Plan.

 

By signing the cover sheet of this Agreement, you agree to all of the terms and conditions described above and in the NDC Plan, and in the Plan and its prospectus. Any inconsistency between this Agreement, NDC Plan and the Plan shall be resolved by reference to the Plan except that any conflicts regarding the time of settlement of Stock Units shall be resolved by reference to the NDC Plan and applicable Deferral Election.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

  6